KUALA LUMPUR (Oct 2): Condom and baby care accessories manufacturer Takaso Resources Bhd has signed a share sale agreement (SSA) with Dynavance Construction Sdn Bhd's shareholders to buy their entire shareholdings in the company.
Takaso buys Dynavance for RM9.5 million cash
In a filing with Bursa Malaysia, Takaso said Dynavance might contribute some 25% or more to Takaso's net profit, thus diversifying Takaso's businesses to include construction and property development.
Dynavance is currently undertaking two construction projects. It has a contract to construct six blocks of low-cost residential apartments for Konsortium SKS Bhd. The RM140 million project, commencing in March 2015, is to be completed in May 2017.
Dynavance’s other project involves the construction and completion of earth and foundation work for an entertainment outlet. The job is worth RM10.52 million and is to be completed in June 2015.
“The acquisition is expected to enhance the earnings of the group (Takaso) for the financial year ending July 31, 2015, as the project is expected to commence in March 2015. The project is expected to enhance the earnings of the group in future years.
“Also, the acquisition is in line with TRB’s strategy to grow and diversify its business operations in future to turn profitable with sustainable growth as well as to balance its income stream from non-traditional sources so as to lessen any future negative industry impact to its traditional business industry,” said Takaso.
Takaso said it planned to venture into construction and property as Malaysia’s construction and property development sector were deemed robust.
According to Takaso, the Dynavance acquisition is expected to reduce Takaso' reliance on its current businesses, which are very dependent on global demand trends.
Takaso expects the proposed acquisition to be completed within three months.
The SSA followed a letter of intent last Thursday (Sept 25) for the planned acquisition of Dynavance.
Today, Takaso shares were traded at 63.5 sen, up 2.5 sen or 4% at 12.30pm for a market capitalisation of RM101.27 million.