KUALA LUMPUR (Jan 26): Based on corporate announcements and news flow today, companies that may be in focus tomorrow (Wednesday, Jan 27) could include the following: Vivocom, Karex, ECS ICT, Astral Asia, CWorks, Selangor Dredging, Ho Hup and IGB REIT.
Vivocom International Holdings Bhd (formerly Instacom Group Bhd)'s unit Vivocom Enterprise Sdn Bhd (VESB) will be the main contractor for the construction of a residential development dubbed 'Phase 5 Desa Tasik', for a contract value of RM230 million.
The development comprises 24 storeys of affordable homes, seven storeys of podium car park, and one storey of common facility, on a piece of vacant land that belongs to the city council, Dewan Bandaraya Kuala Lumpur.
Vivocom said VESB inked the heads of agreement (HoA) with Coneff Corp Sdn Bhd today to appoint VESB as the main contractor of the project, subject to the execution of definitive agreements to be signed within six months from the date of the HoA.
The cost and outlay to implement the project have not been fixed and shall be determined once the feasibility and due diligence reviews are completed. Once determined, VESB will finance the cost and outlay by way of the internally generated funds and/or bank borrowings, as and when required, the group said.
The proposed development is expected to contribute positively to the future earnings of the group, it said.
Karex Bhd's wholly owned subsidiary Karex Holdings Sdn Bhd has entered into an asset purchase agreement with TheyFit, LLC, Dr Michael Cecil and Joseph Nelson for the proposed acquisition of TheyFit's right, title, plus interest to the assets of TheyFit other than the excluded assets and liabilities, for US$1.3 million (RM5.63 million).
According to Karex, TheyFit owns the patents, trade names and trademarks for condoms manufactured, marketed and sold under the TheyFit® brand in key markets such as UK and Europe. Karex said the proposed acquisition is part of its own brand manufacturing (OBM) expansion plan.
The proposed acquisition shall enable Karex group to complement and expand its existing OBM products' family, comprising "Carex", "INNO", ONE® and the recently acquired "ESP".
Once it has obtained the Food and Drug Administration approvals, Karex will be able to market new custom fit condoms to US and global markets, and further expand its market share, it said.
Information and communications technology (ICT) distributor ECS ICT Bhd is entering the wearable technologies market after securing the rights to distribute several smartwatches from renowned global brands.
ECS ICT said its wholly owned subsidiary ECS Astar Sdn Bhd will distribute three smartwatches, namely Apple Watch, Motorola Moto 360 and ASUS ZenWatch 2.
ECS ICT chief executive officer Soong Jan Hsung said the prospects of this segment are exciting, as the group will be able to provide its principals market penetration quickly, since Malaysians are receptive to these new devices.
He said the group is optimistic the wearables segment has significant growth potential and will contribute positively to its performance from this financial year onwards.
Property developer Astral Asia Bhd, which saw its share price jump 25% to a four-year high of RM1.50, announced a proposed bonus issue which involve 539.9 million new shares of 20 sen each to reward its shareholders, and a plan to revalue the company's property assets.
This proposed bonus issue would be on the basis of nine bonus shares for every two existing shares held, and will be effected by the capitalisation of reserves from the company's share premium, capital reserve and available-for-sale fair value reserve arising from the valuation exercise mentioned above.
Astral Asia said the exercise will also increase the capital base of the company to a level that will better reflect the company's current scale of operations and improve the trading liquidity and marketability of its shares on the stock exchange by way of a larger capital base.
The entitlement date for the bonus issue will be determined and announced at a later date.
As for the revaluation of its property assets, the company said it has engaged an independent valuer and a registered property valuer to conduct valuations on its investments in its subsidiaries, as well as properties held by some of the subsidiaries.
CWorks System Bhd proposed to undertake a private placement to raise up to RM4.96 million, assuming an indicative issue of 41 sen per placement share, to be used to develop a new software system for stock maintenance.
The proposed private placement will involve the issuance of up to 12.1 million new shares, or 10% of the existing issued share capital of the group, at an issue price to be fixed and announced later.
By capitalising on the recent up-trend of the group's share price, the proposed private placement will also strengthen the capital base of CWorks to support the continuous business growth of its subsidiaries, it said.
The group expects to complete the corporate exercise during the second quarter of 2016.
Selangor Dredging Bhd's wholly owned unit SDB Properties Sdn Bhd has entered into an agreement with Alam Palma Development Sdn Bhd to buy two parcels of agriculture land in Ulu Klang for RM67.5 million, cash.
Selangor Dredging expects a gross development value of RM450 million on the tract. The property is strategically located in the centre of the Melawati community and surrounded by amenities and infrastructure.
Alam Palma has submitted an application to the relevant authority for approval to develop the land in relation to its intended development based on, inter alia, an increase of density from the existing eight units per acre to 60 units per acre, said Selangor Dredging.
In the event that Alam Palma fails to obtain the approval, SDB Properties shall be entitled at its discretion to either grant further time to Alam Palma or to terminate the agreement.
The purchase price will be funded by bank borrowings and unit of properties developed by the group, while its development will be funded by a combination of internally generated funds and/or bank borrowings.
Ho Hup Construction Company Bhd is planning a renounceable rights issue of ordinary shares and new redeemable preference shares (RPS) of up to 85.14 million each, to raise as much as RM136.22 million, the bulk of which is to fund its construction and property development projects.
Part of the proceeds raised would also be used for the repayment of bank credit facilities (between 29.37% and 36.05%) and defrayment of expenses in relation to the proposals (2.2%–2.7%), said Ho Hup in a bourse filing today.
The proposed rights issue will be on a basis of one rights share for every five existing Ho Hup shares, and each rights share will come with one free, new, detachable warrant (Warrants B).
The proposed rights issue of RPS of 1 sen each will be offered at the same ratio and will also entitle the holder of each rights RPS to one free, detachable warrant (Warrants C).
The proceeds to be raised from the rights shares and RPS was based on an indicative issue price of 80 sen each.
The warrants to be issued in conjunction with the exercise carry a five-year tenure; Warrants B entitle the holder to subscribe for one new Ho Hup share at any time during the period at a price to be fixed, said Ho Hup.
The RPS, meanwhile, comes with a five-year tenure and a cumulative gross preferential dividend at a rate of 5% per annum on the issue price. Ho Hup can also redeem the RPS at any time during the tenure at 100% the issue price.
Ho Hup expects the proposals to be completed in the second quarter of 2016.
IGB Real Estate Investment Trust (REIT)'s distributable income for its fourth quarter ended Dec 31, 2015 (4QFY15) slipped 6.25% year-on-year (y-o-y) to RM61.22 million from RM65.3 million, largely on higher borrowings costs.
As such, it announced a distribution per unit for the second half ended Dec 31 (2HFY15) of 3.72 sen, compared to 3.9 sen in 2HFY14, to be paid on Feb 29, its bourse filing today showed.
Meanwhile, its revenue for 4QFY15 came in at RM121.43 million, 1.5% higher y-o-y from RM119.6 million, mainly due to higher total rental income in the current quarter, which, together with lower property upgrade costs, lifted its net property income by 6.3% y-o-y to RM81.2 million from RM76.4 million.
For the full year ended Dec 31 (FY15), IGB REIT's distributable income amounted to RM291 million, 8.25% higher from FY14's RM268.8 million.
Its FY15 net property income was 9.7% higher y-o-y at RM342.8 million from RM312.6 million, on lower upgrade costs and as its gross revenue came in 5.9% higher y-o-y at RM489.2 million from RM461.77 million, on higher total rental income.
(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)