KUALA LUMPUR (March 2): The Armed Forces Fund Board (LTAT) is understood to be taking Boustead Holdings Bhd private.
The armed forces pension fund holds a 59.4% stake in the group.
It is not currently known how much LTAT will be offering to shareholders to privatise the group.
Trading of Boustead's securities is suspended from 2.30pm to 5pm on Thursday pending a material announcement, according to a filing on Bursa Malaysia.
The conglomerate sank into the red in the fourth quarter ended Dec 31, 2022 (4QFY2022), posting a net loss of RM402.3 million after its 52%-owned subsidiary Pharmaniaga Bhd reported a whopping RM552.3 million impairment provision for the drug maker's unsold Covid-19 vaccine stock.
Boustead incurred a loss per share of 19.85 sen, in contrast to earnings per share of 3.88 sen, or RM78.6 million, in 4QFY2021. This was despite a 25% growth in quarterly revenue to RM3.69 billion from RM2.96 billion, Boustead's Bursa Malaysia filing showed.
Group chief executive officer Izaddeen Daud, who took over the post in December last year, said the writedown was “indeed deeply concerning”.
“Nevertheless, we are confident that Pharmaniaga remains a going concern and is well poised to tap on the strong prospects of the pharmaceutical sector, domestically and regionally.
“We are supporting the management team to ensure a robust regularisation plan is in place to strengthen the company’s balance sheet and progressively work towards the upliftment of the PN17 (Practice Note 17) status,” he added.
On Thursday, the group had redesignated director Datuk Ahmad Nazim Abd Rahman as its non-independent and non-executive chairman.
Ahmad Nazim, 47, is also the chief executive officer of LTAT, which owns 59.4% of Boustead.
According to a bourse filing, Ahmad Nazim has “more than two decades of corporate, investment and restructuring experience across multiple geographies and industries”.
The day before, Boustead redesignated its group finance director Fahmy Ismail as its group chief financial officer.
Fahmy is currently serving as acting chief executive officer of Boustead Plantations Bhd.
UOB Malaysia is understood to be advising LTAT on the privatisation exercise.
At noon break on Thursday, Boustead was up three sen or 4.8% to 65.5 sen, for a market capitalisation of RM1.32 billion.