Thursday 28 Mar 2024
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KUALA LUMPUR (April 20): China-based Sinotop Holdings Bhd (Sinotop) is planning to buy between 60% and up to the entire stake in Asianmax Corp Sdn Bhd, a construction outfit controlled by its major shareholder Datuk Justin Soo, for as much as RM165 million.

It announced in a Bursa Malaysia filing that the group has inked a binding term sheet with Soo today "to explore and negotiate further" with Soo to acquire the stake in Asianmax.

Soo has a 15.19% stake in Sinotop, held via his 70%-owned investment vehicle, Noble Pinnacle Sdn Bhd. Soo owns a 60% stake in Asianmax, while his sister Soo Pat Li, owns the remainder 40%.

The proposed buy would exclude Johnson Fluid Engineering Sdn Bhd, a wholly-owned unit of Asianmax, as the unit is not involved in the construction business, said Sinotop.

The RM165 million purchase consideration may be settled entirely by cash or entirely via the issuance of new redeemable convertible preference shares (RCPS) at an issue price of 42 sen per RCPS, or by a combination of both.

“The proposed acquisition is in line with the overall corporate objectives and plans of the company to strengthen the existing core business of the company in project management and infrastructure construction related businesses,” said Sinotop.

The proposed acquisition comes with a profit guarantee from Soo, which is that the collective aggregate audited profit after tax of Asianmax for the financial years 2019, 2020 and 2021 would not be less than RM50 million.

At market close today, Sinotop slid 3 sen or 6.52% to close at 43 sen, with a market capitalisation of RM169.81 million.

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