KUALA LUMPUR (July 12): Johan Holdings Bhd gained RM210.85 million from the disposal of its entire equity interest in Diners Club (Singapore) Pte Ltd (DCS) and DCS subsidiary DinersPay Pte Ltd (DPPL), resulting in estimated net assets per share of 32.25 sen.
Johan Holdings said in a statement today that its wholly-owned subsidiary Johan Investment Pte Ltd completed the divestments of DCS and DPPL on July 9, 2021 to Ezy Net Pte Ltd for RM313.98 million.
DCS, a Singapore-incorporated company that provides charge and credit card services, had contributed substantially to the group’s revenue under the hospitality and card business segment.
"However, it had been recording substantial losses over the past five financial years which was worsened by the Covid-19 pandemic.
"Hence, with the deconsolidation of DCS and DPPL, the group is virtually debt-free, while the balance sheet is strong and will be further strengthened with the completion of the rights issue of RM38.93 million on July 28, 2021," it added.
Johan Holdings said the group’s plan to exit these loss-making subsidiaries was timely as it had recently obtained shareholders’ approval to venture into the manufacture, sale and distribution of gloves via its 60%-owned subsidiary Dynacare Sdn Bhd.
"The shareholders had approved an investment of approximately RM624.1 million to develop Dynacare’s glove manufacturing plant on a 6.88-hectare piece of industrial land in Lumut, Perak.
"Dynacare’s plant will have a total of 42 double-former glove-dipping lines with a production capacity of approximately 12 billion pieces of examination and surgical gloves per annum," it said.
Johan Holdings said subject to the continuing lockdown due to Covid-19, commercial production is expected to commence in August 2021 with a total of six production lines to be fully operational by December 2021, while the remaining 36 production lines are to be commissioned and operational in stages in 2022 and mid-2023.
"This large production capacity will provide economies of scale, thus ensuring competitiveness in the marketplace.
"The production capacity of 12 billion gloves will make the group one of the top seven glove manufacturers in the country," it said.
Chairman Tan Sri Tan Kay Hock said Johan Holdings would continue to look for opportunities to complement the glove business in the healthcare industry, either organically or through acquisitions.
"We are also continuing our search for other opportunities to further diversify our income base,” he said.