Thursday 28 Mar 2024
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KUALA LUMPUR (July 15): Car paint maker Mercury Industries Bhd is expecting more contracts from EcoFirst Consolidated Bhd and Meda Inc Bhd, following the acquisition of 70% stake in a private construction firm from major shareholder Datuk Tiong Kwing Hee for RM42 million cash.

Tiong said there will be more contracts channelled into Mercury, due to his involvement in EcoFirst and Meda.

He is the chief executive officer of EcoFirst and major shareholder of Ecofirst and Meda, holding 17% and 15% stake in both companies.

He added that a PR1MA project from Meda, which consists of 1,600 units apartments in Melaka, will be awarded to Mercury, moving forward.

"Things are still in the process. We are in the midst of finalising the details, " he told reporters after the extraordinary general meeting (EGM), declining to elaborate more on the contract value and details.

He said EcoFirst and Meda will be seeking shareholders' mandate, so that contracts can be awarded to Mercury in the future.

Shareholders have given approval to Mercury to proceed the related party transaction (RTP) which will see Mercury diversifying its core business to include construction business, after it acquired 70% stake in Paramount Bounty Sdn Bhd from Tiong.

The proposed acquisition is deemed an RPT, as Tiong is the common major shareholder of the aquiree, Paramount Bounty. He owns 70% stake in Paramount Bounty.

Paramount outstanding orderbook as at May 31 is at RM104.3 million and its tenderbook is at RM562 million.

There will be a profit guarantee of RM6.6 million by Tiong for financial year ending Dec 31, 2015 (FY15), to FY17, following the acquisition.

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