KUALA LUMPUR (July 16): MyEG Services Bhd’s unit MyEG Capital Sdn Bhd has announced that it will be disposing of its 10% stake in S5 Holdings Inc to Ancom Logistics Bhd today, a mere five weeks after announcing its plans to purchase equity in the national security solution provider.

In a filing with Bursa Malaysia, MyEG said its subsidiary and other vendors S7 Holdings Sdn Bhd, Merrington Assets Ltd (MAL) and Avocat Sdn Bhd had entered into a heads of agreement with Ancom Logistics and its parent Ancom Bhd to undertake a reverse takeover (RTO) of S5. 

S5 has three subsidiaries, one of which is involved in the provision of national security solutions.

The RTO entails the proposed acquisition by Ancom Logistics of S5’s entire share capital from the four vendors at a price to be agreed upon by the parties involved, subject to a valuation report by an independent party.

Ancom Logistics will fulfil the purchase by issuing new ordinary shares to the vendors at 10 sen apiece.

The vendors will then make a mandatory general offer for all of Ancom Logistics shares that they do not already own, and offer some of the new ordinary shares for sale to independent third-party investors.

MyEG said the proposed RTO provides an avenue to unlock its initial investment — of RM90 million for a 10% stake in S5, thus roughly valuing the company at a whopping RM900 million — as the latter would be listed on the ACE Market and gain access to public markets, boost its standing, and enhance its value through better liquidity and prospective interest from more investors.

The announcement confirms an exclusive report by theedgemarkets.com yesterday about the restructuring of Ancom’s group of companies and its acqusition of S5.

As at 11.08am, MyEG was up three sen or 2.07% at RM1.48, valuing the company at RM5.13 billion.