Friday 29 Mar 2024
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This article first appeared in The Edge Financial Daily, on August 17, 2016.

 

KUALA LUMPUR: Iris Corp Bhd has granted another extension to the purchaser of its 29.83% stake in Versatile Creative Bhd, saying the purchase price may be revised up to RM23.1 million, from the initial price of RM21 million.

In a bourse filing yesterday, the group said the purchaser, Edmund Fong, had requested a further extension of time for the completion date to Sept 20, with the condition that shares acquired between Aug 20 and Sept 20 will be priced at 66 sen per share.

Meanwhile, shares crossed from Aug 16 up to Aug 19 shall be priced at the original pricing of 60 sen per share, as per the initial agreement.

The revised purchase price of 66 sen presents a 45% discount to Versatile Creative’s last traded price of RM1.10.

“And, arising from the above revised conditions, the purchase price may now be revised up to RM23.1 million, based on the maximum selling price of sale shares of 66 sen per ordinary share.

“Any additional proceeds that may be received arising from the above revised conditions is proposed to be utilised for working capital purpose,” said Iris.

To recap, the group entered into a sale and purchase agreement with the purchaser on May 10, for the sale of 35 million ordinary shares, representing 29.83% of Versatile Creative, at a disposal price of RM21 million or 60 sen per share.

Iris said the disposal presented an opportunity for the group to realise the value of its non-core assets, in line with its move to focus on its core businesses, namely trusted ID solutions and systems, education, construction and property development.

It had earmarked RM14.72 million out of the original expected proceeds of RM21 million for the repayment of its borrowings, while the balance of RM6.28 million will be used for working capital purposes.

The exercise was supposed to be completed within 60 days after the execution of the agreement.

However, the completion was extended for an additional five working days to July 19, and was subsequently extended to July 29, before the latest extension to Sept 20.

Iris shares settled 23.5% higher at 21 sen, giving the company a market capitalisation of RM472.34 million. The stock, which saw 260.06 million shares changed hands, was the most active counter on the local bourse yesterday.

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