LBS Bina Group sells entire stake in China Business
LBS Bina Group Bhd has obtained its shareholders’ approval in its Emergency General Meeting (EGM) on Friday for the proposed disposal of its entire stake in Lakewood Golf Club and Zhuhai Development Land in China for a total consideration of HK$1.65 billion (RM681.81 million).
Its Managing Director Lim Hock San said the purchaser, Zhuhai Holdings Investment Group Ltd, has also announced that its shareholders have also approved the resolution on its proposed acquisition at a special general meeting held recently.
Lim said with the approvals from the relevant authorities and shareholders at the EGM, both LBS and Zhuhai Holdings are set to complete the sale and purchase (S&P) agreement soon.
Under the proposed mode of settlement, LBS will be receiving cash of HK$500 million (RM204.09 million), 225.56 million new Zhuhai Holdings listed shares issued at HK$1.33 per share (54 sen) worth HK$300 million (RM122.45 million) and promissory notes for the sum of HK$850 million (RM356.94 million).
“Once we become a substantial shareholder in Zhuhai Holdings, LBS will indirectly benefit from the Zhuhai development project through potential appreciation of Zhuhai Holdings’ share value and any future dividend payments.
“With all these, I am very confident that it will enable our group to retain a healthy balance sheet and thus maintain its strong financial track record,” he told reporters after the EGM in Kuala Lumpur on Friday.
In line with the terms of the agreement, LBS will then be a substantial shareholder of Zhuhai Holdings and will be entitled to appoint its Executive Director (ED) Lim Hock Guan as a non-ED on Zhuhai Holdings board. Pon completion, LBS is set to reap a hefty pro forma gain of RM309 million for the financial year ending 2013, Lim said.
He added that the company has yet to decide on the utilisation of the HK$500 million (RM204.09 million) of cash proceeds, claiming that some of them will go for settlement of bank borrowings, other re-investment in the future or dividends to its shareholders.
On another related development, Integrated Logistics Bhd (ILB) had in June disposed its entire stake in two of its subsidiaries in China.
The proposed transaction was done through ILB’s indirect 70 percent subsidiary Integrated Logistics (HK) Ltd selling SH Logistics (Shenzhen II) Ltd and Integrated Logistics Henan (HK) Ltd for 998 million Yuan (RM519.79 million) to Winfair International Holdings Ltd, a wholly-owned subsidiary company of CJH Investment Co Ltd.
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