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January 31, 2008 |
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MANGIUM: Wants to Acquire MYR240 Mil. Assets in Ramajuta On January 29, 2008, Mangium Industries Bhd. entered into a Memorandum of Understanding with Ramajuta in which, Mangium will acquire assets of Ramajuta, with Sagajuta (Sabah) Sdn Bhd being the principal assets, for a total consideration of MYR240 million. This will be subject to final valuation of the assets and a formal agreement to be finalized. Ramajuta expressed its intention to sell its assets, with Sagajuta being the principal assets to Mangium. This will result in Ramajuta emerging as the majority shareholder of the company. The acquisition will be satisfied by Mangium through the issuance of ordinary shares of MYR1.00 each in the company, which follows: -- an initial payment of MYR90 million to be satisfied by the issuance of 90 million Mangium shares at an issue price of MYR1.00; -- an earn-out payment of MYR60 million that will be satisfied by the new issuance of 60 million Mangium shares at an issue price of MYR1.00, which is conditional on the assets making a profit after tax of MYR60 million for the financial year ending December 31, 2008; -- a second earn-out payment of MYR45 million that will be satisfied by the new issuance of 45 million Mangium shares at an issue price of MYR1.00, which is conditional upon the said assets making a profit after tax of MYR8 million for the financial year ending December 31, 2009, and having a net tangible asset value of not less than MYR250 million; and -- a third earn-out payment of MYR45 million to be satisfied by the new issuance of 45 million Mangium Shares at an issue price MYR1.00, which is conditional upon the said assets making a profit after tax of MYR8 million for the financial year ending December 31, 2010, and having a net tangible asset value of not less than MYR300 million. An agreement will be executed within a period granted by Bursa Malaysia Securities Berhad or 12 months from the date of the MOU. This in respect of the regularisation plan pursuant to Practice Note No. 17/2005 of the Listing Requirements of Bursa Securities. In the event the Parties are unable to execute the definitive agreement at the expiry of the period granted by Bursa Securities, the parties agreed that the MOU will be deemed to be terminated by mutual consent. The Parties may also extend the term of the MOU by mutual agreement. About Mangium Industries Mangium Industries Berhad's principal activities are the manufacture and trade of timber and timber related products. Other activities include provision of printing services, publisher, printer consultants and advertisers, trading of alcoholic beverages, general trading of office furniture, operation and development of the plantation and investment holding. Operations of the Group are carried out in Malaysia. The TCR-AP reported on May 25, 2007, that Mangium Industries, on May 22, became an affected listed issuer pursuant to the provisions of Amended Practice Note 17/2005, as its shareholders' equity on consolidated basis is less than 25% of its issued and paid-up capital. As an affected listed issuer, Mangium is required to formulate and implement a plan to regularize its financial condition within a timeframe stipulated by relevant authorities. |
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