KUALA LUMPUR (July 22): Animal health products maker and distributor Peterlabs Holdings Bhd (PHB) said it is venturing into distribution of consumer goods, through the acquisition of a 60% stake in Thye On Tong Trading Sdn Bhd (TOT).
In a bourse filing today, the company said the RM10.8 million purchase consideration for the stake will be satisfied via a cash payment of RM3 million and the issuance of 39 million new PHB shares at 20 sen per share.
TOT has been principally engaged in the distribution of consumer goods for 33 years, spanning from home care, oral care, baby care and feminine care products, to infants' milk powder and grain products.
Its head office is located in Senawang, Seremban with a branch office in Durian Tunggal, Melaka. It also operates a warehouse with a total built-up area of 1.5 acres and a total capacity for storage of 3,000 pallets.
Some salient terms of the purchase agreement require TOT to provide PHB at least RM4.5 million profit guarantee for its financial years ending Dec 31, 2021 and Dec 31, 2022.
On the rationale for the acquisition, PHB said the deal will enable it to extend its product range and provide an additional income stream.
The deal is expected to be completed by the fourth quarter this year, it added.
Shares in Peterlabs closed four sen or 13.56% lower at 25.5 sen, giving the group a market capitalisation of RM55 million. Year to date, the stock has risen by 24.4%.