KUALA LUMPUR: Loss-making Asiamet Education Group Bhd’s (AEGB), formerly Masterskill Education Group Bhd, is selling properties in Kuching, Sarawak for RM8.5 million cash. The properties will be leased back to AEGB.

In a filing with Bursa Malaysia yesterday, AEGB said its wholly-owned unit Masterskill (M) Sdn Bhd (MMSB) has entered into a sale and purchase agreement with hotel operator Pavilion Palace Sdn Bhd for the disposal.

“The directors are of the view that the sale consideration is fair and reasonable,” it stated.

AEGB said the original cost of investment by MMSB was RM13.8 million. “MMSB expects to realise an estimated loss of RM851,000 from the proposed disposal based on the net book value of the properties of RM9.35 million as at June 30, 2015,” it added. 

The properties are leasehold for 870 years expiring on March 8, 2826, and comprise eight contiguous units comprising six units of three-storey and two units of four-storey terraced shophouses.

The proposed disposal is expected to be completed in the first quarter of 2016.

“The total gross proceeds of RM8.5million from the proposed disposal are expected to be used as working capital within 12 months from the date of receipt of the full payment on the completion of the agreement,” said AEGB, noting that this will not have any material impact on earnings per share.

MMSB has also entered a tenancy agreement with Pavilion Palace, which shall commence immediately upon completion of the agreement.

AEGB’s share price tumbled 43% since the start of the year, falling from 70 sen to a low of 32.5 sen. The stock closed at 40 sen yesterday, with a market capitalisation of RM142.9milllion.

This article first appeared in digitaledge Daily, on September 10, 2015.