KUALA LUMPUR (Jan 27): LKL International Bhd said its wholly-owned unit LKL Advance Metaltech Sdn Bhd (LKLAM) is buying 60.2 million shares, representing a 13.78% stake, in travel management company Parlo Bhd at the price of 22 sen each, for a total cash consideration of RM13.24 million.

LKLAM, which is principally involved in the business of providing medical and healthcare beds as well as peripherals and accessories entered into an agreement on Thursday (Jan 27) with Parlo's substantial shareholder Thirty Keystone Sdn Bhd.

According to LKL, the proposed acquisition represents a strategic investment for LKL with potential synergy to the existing and future business of the group.

"Apart from its existing business of travel and tours, employment agency related services and digital services, Parlo on Sept 29, 2021 subscribed to 51% equity interest in V Care Industries (Malaysia) Sdn Bhd.

"The subscription will provide an opportunity for Parlo to [be] [involved] in [the] business of trading of medical and pharmaceutical related products. LKL is also expected to leverage on Parlo's existing vast data of clientele and customer base," noted LKL in its filing with the bourse.

It added, the exercise which will be satisfied via internally generated funds is expected to strengthen LKL's existing business and to have a better competitive advantage in the challenging market.

The exercise, LKL said, is not expected to have any material effect on its earnings, earnings per share, net assets and gearing for the financial year ending Sept 30, 2022.

Shares of LKL International ended Thursday's trading day at 7.5 sen, down by 6.25% or half a sen. The company has a market value of RM71.9 million.

Parlo shares slipped half a sen or 3.13% to close at 15.5 sen, valuing it RM67.71 million.