Brahims to buy remaining 49% stake in Brahims-LSG sky Chefs for Rm130m cash

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KUALA LUMPUR (May 21): Brahims Holdings Bhd (BHB) is en route to transforming itself into a food and beverage (F&B) centric company after it proposed to acquire 49% equit interest in Brahim’s-LSG Sky Chefs Holdings Sdn Bhd (BLH) for RM130 million cash.
The company had acquired a 51% equity interest in BLH in 20008, and re-branded itself as a niche player in the F&B Industry.
Brahims said on Monday the acquisition will involve the purchase of 490,000 shares of RM1 each for RM130 million cash, to be funded via bank borrowings.
In a filing to regulators on May 21, Hwang DBS Investment Bank on hbahlf of Brahims said the company had entered into a conditional share sale agreement with LSH Asia GmbH in relation to the acquisition.
On the rationale for the acquisition, BHB said its commitment to focus on its core business in F&B businesses was further affirmed when BHB entered into conditional agreements in the first quarter of 2012 to divest its entire logistic businesses, and ventured upstream into sugar manufacturing and refining businesses via acquisition of Admuda Sdn Bhd as announced on Feb 14, 2012.
It said BLH had been a major revenue and profit contributor of the BHB Group since 2008.
BHB said the Proposed BLH acquisition was expected to enhance the future earnings capability of the BHB Group through 100% consolidation of the profitable results of BLH which was currently accounted based on proportionate consolidation of a jointly controlled entity.
“The proposed BLH acquisition will also allow the BHB Group to have full control of BLH and hence providing flexibility for BHB to integrate BLH into BHB Group’s future strategic plan,” it said.