KUALA LUMPUR (Aug 22): SCGM Bhd plans to distribute RM2.21 per share to its shareholders from the proceeds of the disposal of its 100% equity interest in Lee Soon Seng Plastic Industries Sdn Bhd (LSSPI) to Japan’s Mitsui & Co Ltd and FP Corporation (FPCO) for approximately RM544.38 million cash.

In a statement on Monday (Aug 22), the food packaging manufacturer said its shareholders gave their approval for the disposal in an extraordinary general meeting on Saturday.

SCGM said Mitsui would acquire 60% equity interest representing 63.88 million LSSPI shares for RM326.63 million cash, while FPCO would acquire the remaining 40% equity interest or 42.59 million shares for RM217.75 million cash.

The Tokyo Stock Exchange-listed Mitsui is a global trading and investment company, with a diversified business portfolio that spans approximately 63 countries in Asia, Europe, North, Central and South America, the Middle East, Africa and Oceania, with a diverse core business portfolio covering the mineral and metal resources, energy, machinery and infrastructure, and chemicals industries.

Separately, LSSPI also entered into a conditional sale and purchase agreement with SCGM’s unit Habipack Sdn Bhd for the transfer of three contiguous parcels of land with factory buildings and other ancillary buildings in Senai, Kulai, Johor for RM18.8 million cash.

SCGM said the disposal consideration of RM544.38 million consists of the following:

i) RM425.56 million being earmarked for distribution to entitled SCGM shareholders;

ii) RM18.8 million for the transfer of properties.

The company said the RM425.56 million will be distributed in the following manner:

i) The capital reduction and repayment exercise would cancel RM69.32 million of SCGM’s share capital, whereby it will reduce the company’s share capital from RM132.44 million to RM63.12 million, and which will be distributed to entitled shareholders by way 36 sen per SCGM share;

ii) The board would also declare and pay part of the disposal consideration as a special cash dividend of RM1.85 per share.

SCGM said the entitlement date for the special dividend will not be the same as the entitlement date for the capital reduction and repayment exercise.

It said the capital reduction and repayment exercise and special dividend are expected to be completed by the fourth quarter of 2022.

At the time of writing on Monday, SCGM was trading at RM2.36, with 1.01 million shares done.