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YTL CORPORATION BERHAD |
PROPOSED ACQUISITION OF 90.09% OF THE ISSUED AND PAID-UP SHARE CAPITAL OF C.I. READYMIX SDN BHD BY YTL CEMENT BERHAD |
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| 1. |
INTRODUCTION |
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The Company is pleased to announce that its subsidiary company, YTL Cement Berhad ("YTL Cement") has entered into a conditional Sale & Purchase Agreement ("the Agreement") with C.I.Building Industries Sdn Bhd, a subsidiary of C.I.Holdings Berhad for the proposed acquisition of 90.09% equity interest in C.I. Readymix Sdn Bhd (Company No. 095180-X) ("CI Readymix"), a subsidiary company of C.I. Holdings Berhad comprising 6,306,306 ordinary shares of RM1.00 each ("Sale Shares") ("Proposed Acquisition"). |
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| 2. |
DETAILS OF THE PROPOSED ACQUISITION |
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CI Readymix is a private company incorporated with limited liability under the Companies Act, 1965 with its registered office at B-9-5, Block B, Level 9, Megan Phileo Promenade, 189, Jalan Tun Razak, Kuala Lumpur. Its authorised share capital is RM10,000,000 divided into 10,000,000 ordinary shares of RM1.00 each of which 7,000,000 ordinary shares of RM1.00 each have been issued and fully paid-up. CI Readymix is principally involved in the manufacture and sale of ready-mixed concrete.
The purchase consideration of the Proposed Acquisition is RM14,864,850 and was arrived at on a willing buyer-willing seller basis after taking into consideration the unaudited net tangible asset backing of CI Readymix of approximately RM16.5 million as at 30 June 2000. The final purchase consideration will be subject to adjustment based on a further financial due diligence prior to completion. The Proposed Acquisition would be funded from the YTL Cement's internally generated funds and bank borrowings.
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RATIONALE FOR THE PROPOSED ACQUISITION |
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The Company and its principal subsidiary company, Buildcon Concrete Sdn Bhd are engaged in the manufacture and supply of ready-mixed concrete. It is presently one of the largest ready-mixed concrete companies in Malaysia. The Proposed Acquisition would therefore allow the existing Group to significantly expand its operations in the ready-mixed concrete industry. The Proposed Acquisition is also synergistic with the Group's cement manufacturing activities carried out through associate company, Pahang Cement Sdn Bhd and wholly-owned subsidiary company, Slag Cement Sdn Bhd as the supply of bulk cement to the ready-mixed concrete industry constitutes a major part of the business of the Group. |
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| 4. |
FINANCIAL EFFECTS OF THE PROPOSED ACQUISITION
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4.1
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Earnings |
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The Proposed Acquisition is expected to contribute positively to the longer term earnings of the YTL Cement and YTL Corporation Group. It is not expected to have any material impact on the earnings of the YTL Cement and YTL Corporation Group for the current financial year.
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| 4.2 |
Net Tangible Asset |
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The Proposed Acquisition is not expected to have a material impact on the Net Tangible Asset backing of the YTL Cement and YTL Corporation Group for the current financial year. |
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| 5. |
CONDITIONS PRECEDENT |
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The Proposed Acquisition is subject to, inter alia, the following conditions precedent being fulfilled within three (3) months from the date of the Agreement::-
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i)
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due diligence review; and |
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waiver of pre-emption rights, if any, over the Sale Shares by other shareholders of CI Readymix. |
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| 6. |
APPROVALS REQUIRED |
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The Proposed Acquisition is subject to the approvals of the following:-
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Foreign Investment Committee; and |
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any other relevant authorities. |
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| 7. |
DIRECTORS AND SUBSTANTIAL SHAREHOLDERS' INTEREST |
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None of the Directors and Substantial Shareholders of the Company and YTL Cement and persons connected to the Directors and Substantial Shareholders of the Company and YTL Cement has any interest, direct or indirect, in the Proposed Acquisition. |
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PROPOSED QUARRY OPERATIONS OF C.I. QUARRIES SDN BHD, C.I. QUARRIES (NILAI) SDN BHD AND C.I. QUARRYING & MARKETING SDN BHD AND THE PROPOSED EQUIPMENT PURCHASE BY BATU TIGA QUARRY SDN BHD FROM C.I. QUARRIES SDN BHD, C.I. QUARRIES (NILAI) SDN BHD AND C.I. QUARRYING AND MARKETING SDN BHD
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| 1. |
INTRODUCTION |
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The Company is pleased to announce that its wholly-owned subsidiary, Batu Tiga Quarry Sdn Bhd ("BTQ") has also entered into the following agreements:-
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Quarry Agreements with C.I. Quarries Sdn Bhd, C.I. Quarries (Nilai) Sdn Bhd and C.I. Quarrying & Marketing Sdn Bhd each appointing BTQ as the sole operator to carry out the entire Quarry Operations at or on five (5) quarries located at Semenyih in Selangor, at Nilai in Negeri Sembilan, at Kulai in Johore and at Berapit and Penanti in Penang ("Proposed Quarry Operations").
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a Sale and Purchase Agreement with C.I. Quarries Sdn Bhd; C.I. Quarries (Nilai) Sdn Bhd and C.I. Quarrying & Marketing Sdn Bhd for the purchase of quarry equipment located at Semenyih in Selangor, at Nilai in Negeri Sembilan, at Kulai in Johore and at Berapit/Penanti in Penang ("Proposed Equipment Purchase"); and |
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DETAILS OF THE PROPOSED QUARRY OPERATIONS AND PROPOSED EQUIPMENT PURCHASE |
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Under the terms of the agreements for the Proposed Quarry Operations, BTQ will be the sole operator of the quarries at the aforementioned locations for a period of ten (10) years.
The Proposed Equipment Purchase is for a total cash consideration of RM4 million. The purchase consideration was arrived at based on a willing buyer-willing seller basis after taking into consideration fair wear and tear of the quarry equipment. The Proposed Equipment Purchase would be funded from BTQ's internally generated funds and bank borrowings.
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RATIONALE FOR THE PROPOSED QUARRY OPERATIONS AND PROPOSED EQUIPMENT PURCHASE |
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BTQ and its subsidiary company, Jaksa Quarry Sdn Bhd are engaged in quarry operations.The Proposed Quarry Operations and the Proposed Equipment Purchase would therefore allow the existing BTQ Group to further expand its operations in the quarry industry. It will also complement the construction contracting and the ready-mixed concrete divisions of the YTL Group. |
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| 4. |
FINANCIAL EFFECTS OF THE PROPOSED QUARRY OPERATIONS AND PROPOSED EQUIPMENT PURCHASE |
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| 4.1 |
Earnings |
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The Proposed Quarry Operations are expected to contribute positively to the longer term earnings of the YTL Corporation Group. Neither the Proposed Quarry Operations nor the Proposed Equipment Purchase are expected to have any material impact on the earnings of the YTL Corporation Group for the current financial year.
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| 4.2 |
Net Tangible Asset |
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The Proposed Quarry Operations and Proposed Equipment Purchase are not expected to have a material impact on the Net Tangible Asset backing of the YTL Corporation Group for the current financial year. |
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| 5. |
CONDITIONS PRECEDENT |
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Completion of the agreements for the Proposed Quarry Operations and Proposed Equipment Purchase is subject to, inter alia, the following conditions precedent being fulfilled within thirty (30) days from the date of the respective agreements:-
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CI handing over vacant possession of the quarry land to BTQ save for all the quarry equipment which will be simultaneously delivered to BTQ; and
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BTQ conducting a due diligence review of all the relevant contracts and permits for or in relation to the quarry land and the quarry operations; and
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if necessary, CI obtaining the approval of the relevant authorities for BTQ to carry out the quarry operations on the quarry land. |
The Proposed Equipment Purchase and the Proposed Quarry Operations are interconditional. |
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| 6. |
APPROVALS REQUIRED |
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The Proposed Quarry Operations and the Proposed Equipment Purchase are not subject to any regulatory approvals. |
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| 7. |
DIRECTORS AND SUBSTANTIAL SHAREHOLDERS' INTEREST |
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None of the Directors and Substantial Shareholders of the Company and YTL Cement and persons connected to the Directors and Substantial Shareholders of the Company and YTL Cement has any interest, direct or indirect, in the Proposed Quarry Operations and the Proposed Equipment Purchase. |