KUALA LUMPUR (April 17): Prestar Resources Bhd has varied the purchase consideration for the sale of Tashin Steel Sdn Bhd to a special purpose vehicle which will be listed on the Ace Market later on. 

In a filing with Bursa Malaysia, Prestar said the shareholders of Tashin Steel — Prestar and Formula Naga Sdn Bhd — have entered into a supplemental share sale agreement with the SPV Tashin Holdings Bhd to acquire the entire share capital of Tashin Steel for RM144.83 million. 

Prestar and Formula Naga have 51% and 49% respectively in Tashin Steel. 

Prestar said the price of the stake was arrived at, after taking into consideration the audited net assets of Tashin Steel as at Dec 31, 2017 of RM144.83 million.  

It said the proposed acquisition will be settled by the issuance of 289.66 million new Tashin Holdings shares to the initial shareholders, Prestar and Formula Naga, at an issue price of 50 sen per share.  

Upon completion of the proposed acquisition, Tashin Holdings will then undertake an initial public offering (IPO) involving a public issue of 59.33 million new shares and an offer for sale by Prestar and Formula Naga of 55.49 million shares.  

The public issue represents 17% of Tashin Holdings’ enlarged share capital, while the offer for sale by Prestar and Formula Naga represents 15.9%.

Under the public issue, 5% of the enlarged share capital of Tashin Holdings will be made available for application by the Malaysian public via balloting process; 2.5% will be reserved for eligible directors, employees and business associates; 5% made available to shareholders of Prestar; and another 4.5% reserved for private placement to selected Bumiputera investors approved by the Ministry of International Trade and Industry (MITI). 

Meanwhile, the sale of shares by Prestar and Formula Naga will be offered to selected investors and Bumiputera investors that are approved by MITI by way of private placement at an offer price to be determined later.  

Upon completion of the IPO, Tashin Holdings will be listed on the ACE Market of Bursa Malaysia. 

Prestar said total proceeds to be raised from the proposed offer for sale will be utilised for repayment of bank borrowings, amounting to approximately RM41.7 million as at Dec 31, 2017. Additionally, it will also be utilised for expenses relating to the proposals. 

The filing added that applications to relevant authorities for listing purposes will be submitted within two months, and is expected to be completed by the fourth quarter of 2018, barring any unforeseen circumstances. 

The proposed listing was first announced by Prestar on July 12, 2017. 

An earlier share sale agreement for the sale of Tashin Steel was entered into on Jan 9 for a consideration of RM144.07 million, to be satisfied with the issuance of 288.14 million new Tashin Holdings' shares. 

Prestar's share price was unchanged at market close today at 89 sen, on 120,800 shares traded, giving the group a market capitalisation of RM175.26 million.