KUALA LUMPUR: Iconic Worldwide Bhd is acquiring Goldenluck Development Sdn Bhd for RM39.8 million as part of the expansion of its property investment business.
In a filing with Bursa Malaysia on Monday, Iconic said it has entered into a share purchase agreement with vendors — Datuk Seri Tan Kean Tet and Tan Seok Ying — to acquire 200,000 ordinary shares representing 100% equity interest in Goldenluck, which will be entirely satisfied via cash.
The proposed acquisition is deemed a related-party transaction.
Additionally, Iconic also intends to issue 1.12 billion new shares on the basis of two-for-one, together with 749.8 million warrants on the basis of two-for-three subscribed by entitled shareholders.
Iconic will raise a minimum RM60 million and a maximum of RM112.47 million from the issuance of the rights shares.
To achieve the minimum proceeds raised from the rights issue, Iconic has procured the irrevocable undertaking from Kean Tet and Modern Rewards Sdn Bhd, a company controlled by Kean Tet, to apply and subscribe in full for their entitlement of rights shares and additional rights shares not taken up by other entitled shareholders, to the extent such that the aggregate subscription proceeds received by the company are at least RM40 million.
Iconic will also enter into an underwriting arrangement for the remaining RM20 million.
The proceeds from the rights issue will be utilised for the acquisition of Goldenluck, repayment of bank borrowings and working capital requirements.
The company also proposed for exemption of the Rules on Takeovers, Mergers and Compulsory Acquisitions for Kean Tet and persons acting in concert (PACs) with him from the obligation to undertake a mandatory offer for all the remaining shares in Iconic not already owned by him and PACs.
Kean Tet is the managing director and the largest shareholder of Iconic with a 26.1% stake in the group.
Goldenluck is principally involved in property investment and currently owns the land in Penang as its sole major asset.
The land comprises a parcel of freehold vacant land measuring approximately 6.07 hectares. The land is valued at RM45.7 million as ascribed by Henry Butcher Malaysia (Penang) Sdn Bhd.
It is zoned as a hill land and sited adjacent to a residential development known as Green Garden and is located along the main thoroughfare of Jalan Paya Terubong in the locality of Paya Terubong on Penang Island.
Iconic is in the midst of deliberating on the development plan for the land to undertake residential development project after the completion of the proposed acquisition.
The acquisition is expected to be completed in the second half of 2022.
Source : The Edge Markets