Stock Name / : / BSTEAD
Date Announced / : / 1/12/2010
Type / : / Announcement
Subject / : / DISPOSAL OF 1-ACRE COMMERCIAL LAND IN MUKIM PULAI, DISTRICT OF JOHOR BY MUTIARA RINI SDN BHD, A WHOLLY OWNED SUBSIDIARY OF BOUSTEAD HOLDINGS BERHAD TO BOUSTEAD PETROLEUM MARKETING SDN BHD (“DISPOSAL”)
Contents :
- Introduction
The Board of Directors of Boustead Holdings Berhad (“the Company”) wishes to announce that Mutiara Rini Sdn Bhd (“MRSB”), a wholly owned subsidiary of the Company had on 1 December 2010 entered into a Sale and Purchase Agreement ("SPA")to dispose a 1-acre plot of commercial land which forms part of H.S.(D) 486033 PT No. PTD 176566 Mukim Pulai, District of Johor Bahru, State of Johor to Boustead Petroleum Marketing Sdn Bhd (Company No. 5783-T) (“BPMSB”) for a total consideration of Ringgit Malaysia Three Million Nine Hundred and Sixty Three Thousand, Nine Hundred and Sixty Only (RM3,963,960.00) or RM91.00 per sq. ft. (“Disposal Price”).
- Related Party Transaction
BPMSB is a 70% subsidiary of Boustead Petroleum Sdn Bhd (“BPSB”) which in turn is a 53% subsidiary of the Company. The Disposal is deemed a related party transaction under Chapter 10 of the Listing Requirements of Bursa Malaysia Securities Berhad.
- Details of the Property
The Property is part of the overall residential and commercial development being carried out and launched to the public in Taman Mutiara Rini, Skudai, Johor.
The 1-acre property is leasehold in nature with a lease of 991 years expiring in 2911. The property is vacant at the present time.
- Information on MRSB
The principal activity of MRSB is property development. Its main development projects are in Taman Mutiara Rini, Johor, a 1,400 acre mixed residential and commercial project, and Mutiara Damansara, Selangor a 350 acre mixed residential and commercial project.
- Information on BPMSB
The principal activity of BPMSB is marketing of petroleum products.
6.Rationale For The Transaction
MRSB is a licensed property developer and the Disposal is in the ordinary course of business.
7.Basis of Arriving at the Consideration
The consideration of Ringgit Malaysia Three Million Nine Hundred and Sixty Three Thousand, Nine Hundred and Sixty Only (RM3,963,960.00) was arrived at on a willing buyer-willing seller basis.
8.Salient Features of the SPA
The Transaction, was entered into under normal commercial terms and conditions, which are generally available to other customers of the Boustead Group (“Group”).
The mode of payment of the consideration is cash and the estimated time frame for the completion of the disposal is 6 months from the date of the SPA.
9.Financial Effects of the Transaction
Share Capital
The Disposal will not have any effect on the issued and paid up share capital of the Company.
Net Assets
The Disposal will not have a material effect on the Net Assets of the Group.
Earnings
The Disposal will not have a material effect on Earnings per Share of the Group for the year ending 31 December 2010.
10.Directors’ and Substantial Shareholders’ Interests
None of the major shareholders or Directors of the Company or any person(s) connected to them have any interest, directly or indirectly in the Disposal, save and except for the following:-
Y.Bhg. Tan Sri Dato’ Lodin Wok Kamaruddin is a shareholder of BPSB and a director of BPMSB, BPSB and the Company and is deemed interested in the Disposal.
11.Statement of Directors
The Board of the Company, save for Y.Bhg. Tan Sri Dato’ Lodin Wok Kamaruddin, having considered all aspects of the Disposal,is of the view it is in the best interest of the Company and the Group.
12. Audit Committee’s Statement
The Audit Committee, having considered all aspects of the Proposed Disposal and after careful deliberation, is of the opinion that the Disposal is in the best interest of the Company. The Audit Committee agrees that the Disposal is fair, reasonable and on normal commercial terms and are not detrimental to the interest of the minority shareholders of the Company.
13.Approvals Required
The Disposal falls under the provisions of Rule 10.08 of the Listing Requirements of Bursa Malaysia Securities Berhad. However as the Disposal does not exceed the 5% percentage ratio as defined therein, the Disposal does not require the prior approval of shareholders of the Company or any other authority.
14.Expected Completion Date
Barring unforeseen circumstances, the Disposal is expected to be completed in the second half of 2011.
15.Departure From Securities Commission’s Policies and Guidelines on Issue/Offer of Securities (“SC Guidelines”)
To the best knowledge of the Board, the Disposal does not depart from the SC Guidelines.
16.Documents for Inspection
The SPA may be inspected at the Registered Office of the Company.