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General Announcement Reference No. CP-101130-75305 Appendix MILUX CORPORATION BERHAD Proposed acquisition of all that piece of freehold industrial land identified as Lot 97 within Rawang Integrated Industrial Park and held under Industrial title Geran 205564, Lot 19029 Seksyen 20, Bandar Rawang Daerah Gombak, Negeri Selangor together with buildings erected thereon by T. H. Hin Sdn. Bhd., a wholly-owned subsidiary of the Company from Sterilgamma International Sdn. Bhd for RM4.2 million * Contents :- 1.0 INTRODUCTION The Board of Directors of Milux Corporation Berhad (“Milux” or “Company”) wishes to announce that T.H. Hin Sdn. Bhd. (“T.H. Hin”), a wholly-owned subsidiary of Milux, has on 1 December 2010 entered into a Sale and Purchase Agreement (the “Agreement”) with Sterilgamma International Sdn. Bhd. (“SISB”) to acquire all that piece of freehold industrial land identified as Lot 97 within Rawang Integrated Industrial Park and held under Industrial title Geran 205564, Lot 19029 Seksyen 20, Bandar Rawang Daerah Gombak, Negeri Selangor measuring approximately 10,036 square metres together with double storey office annexed with a single storey detached factory erected thereon (collectively referred to as the “Property”), free from all encumbrances and with vacant possession on an as is where is basis, for a total purchase consideration of RM4.2 million (the “Proposed Acquisition”). 2.0 DETAILS OF THE PROPOSED ACQUISITION 2.1 Information on T.H. Hin T.H. Hin was incorporated on August 16, 1977 in Malaysia under the Companies Act, 1965 as a private limited company under the name of Tatt Chuon Trading Sdn. Bhd. On February 12, 1980, the company changed its name to T. H. Hin Sdn. Bhd. Presently, the authorised share capital of T.H. Hin is RM500,000 comprising 500,000 ordinary shares of RM1.00 each, of which 300,000 ordinary shares of RM1.00 each have been issued and fully paid-up. The business activity of T.H. Hin is principally involved as dealer in gas cookers, electrical household appliances and their related products. 2.2 Information on SISB SISB was incorporated on 9 June 2004 as a private limited company in Malaysia under the Companies Act, 1965 company under the name of SG-eBeam (M) Sdn. Bhd. On 17 November 2009, the company changed its name to Sterilgamma International Sdn. Bhd. The authorised share capital of SISB is RM100,000 comprising 100,000 ordinary shares of RM1.00 each, of which 2 ordinary shares of RM1.00 each have been issued and fully paid-up. SISB is principal business is that of investment holding. 2.3 Information on the Property The Property is located at Lot 97, Jalan Industri 3/5, Rawang Integrated Park, Rawang, Selangor and lies approximately 7 Kilometers to the South West of Rawang Town Centre. It is accessible from Rawang Town Centre via Jalan Rawang- Batu Arang, turning left into Persiaran Rawang 1 and finally turning into Jalan Industri 3/5, where the Property is situated The land is a piece of freehold industrial land measuring approximately 10,036 square metres identified as Lot 97 within Rawang Integrated Industrial Park and held under Industrial title Geran 205564, Lot 19029 Seksyen 20, Bandar Rawang Daerah Gombak, Negeri Selangor measuring approximately 10,036 square metres (108,027 sq ft) together with double storey office annexed with a single storey detached factory erected thereon. As at to-date, the Developer is still the registered proprietor under individual document of title to the Property. The original document of title to the Property is in custody of the Alliance Bank Malaysia Berhad (the “Beneficial Owner”). The Certificate of fitness for occupation to the Property has been issued by the relevant authorities. 2.4 Basis of purchase consideration The Purchase Price was arrived at on a willing-buyer willing-seller basis after taking into consideration, amongst others, the open market value of the Property ascribed by Ravindra Dass Property Services Sdn. Bhd. (“Valuer”), a firm of independent registered valuer based on their valuation report dated 7 April 2009 conducted by SISB (“Valuation Report”). Having regard to all relevant information, the Valuer opined that the market value of the Property as at 7 April 2009 using the comparison method of valuation and the cost method of valuation is RM5.2 million. The basis of valuation for the Property by the Valuer is based on an as-is where is basis as a plot of building land constructed with single storey detached factory with an annexed two storey office building in a poor condition. The forced sale value of the Property is RM4.16 million. The Purchase Price represents a discount of RM1 million (approximately 19.23%) over the aforesaid market value. The Proposed Acquisition is proposed to be funded by internally generated funds and/or bank borrowings of T.H. Hin. The Purchase Price will be settled in the following manner:- (i) Immediately upon execution of the Agreement, T.H. Hin shall pay a sum of RM420,000 only towards the Purchase Price as deposit to SISB’s Solicitors; and (ii) The balance Purchase Price of RM3,780,000 only (the “Balance Purchase Price”) shall be paid or deemed paid by T.H. Hin to SISB in the manner stated in Clause 4.2 of the Agreement within 3 months from the date on which Agreement become unconditional pursuant to Clause 3.1 of the Agreement (“Completion Period”) failing which SISB shall grant to T.H. Hin 1 month from the expiry of the Completion Period or such longer period as the parties may agree in writing (the “Extended Completion Period”) to pay the Balance Purchase Price in which T.H. Hin shall pay to SISB the late payment interest calculated on a day to day basis in respect of outstanding and unpaid Balance Purchase Price from the date next to the last date of the Completion Period to the date of actual payment thereof. 2.5 Salient terms of the Agreement The salient terms of the Agreement are as follows:- 2.5.1 The Agreement shall become unconditional upon the occurrence of the following events, whichever shall be the later:- (a) The date of receipt of T.H. Hin’s solicitors the Beneficial Owner’s letter of confirmation stated in Clause 3.1 of the Agreement; (b) The date of receipt by T.H. Hin’s solicitors of the Direct Transfer and (if applicable) stamping proforma (Borang PDS 15) duly executed by the Developer in favour of T.H. Hin or the duly stamped SISB’s transfer in the event the Developer reject the Direct Transfer; (c) The date of receipt by T.H. Hin’s solicitors written confirmation (with supporting documents) that SISB has complied with all the conditions imposed by the Beneficial Owner and/or the Developer set out in the Beneficial Owner’s confirmation and consent for Direct Transfer from the Developer. 2.5.2 The Balance Purchase Price shall be released to the Beneficial Owner upon the expiry of 7 days from the presentation of original issue document of title to the Property, the Direct Transfer (or as the case may be SISB’s transfer) and the Charge (if any) and the relevant documents for registration at the relevant land office/registry. 2.6 Liabilities to be assumed and additional financial commitment required There is no liability to be assumed by T.H. Hin arising from the Proposed Acquisition. The Board does not foresee any material additional financial commitment required for the Proposed Acquisition. 3.0 RATIONALE FOR THE PROPOSED ACQUISITION The Property will be used by Milux Group to house its corporate office cum factory and warehouse to centralise and accommodate existing Euro Uno Sales & Service Sdn Bhd and T.H. Hin’s operations and also anticipated future growth in their businesses This will enable efficient and effective control, monitoring and mobilization of resources within Milux Group. 4.0 FINANCIAL EFFECTS OF THE PROPOSED ACQUISITION 4.1 Share Capital and Substantial shareholders’ shareholdings The Proposed Acquisition will have no effect on the share capital and substantial shareholders’ shareholdings in the Company. 4.2 Earnings The Proposed Acquisition is not expected to have any material effect on the earnings per share of Milux Group for the financial year ending 31 August 2011. 4.3 Net Assets (“NA”) The Proposed Acquisition will not have any material effect on the NA per share of Milux Group for the financial year ending 31 August 2011. 4.4 Gearing The Proposed Acquisition is not expected to have any material effect on the gearing level of Milux Group for the financial year ending 31 August 2011. 5.0 INTEREST OF DIRECTORS, SUBSTANTIAL SHAREHOLDERS AND PERSONS CONNECTED TO SUCH DIRECTORS AND/OR SUBSTANTIAL SHAREHOLDERS None of the Directors and substantial shareholders of the Company and persons connected with them, has any direct or indirect interest in the Proposed Acquisition. 6.0 RISK FACTORS The economic value of the Property is subject to the risks inherent in the property market. These include, inter-alia, changes in general economic, business and credit conditions and demand for industrial properties. These factors will inevitably affect the tenancy rates and the value of the Property. However, the Property is intended to be mainly owner-occupied rather than for investment purpose. 7.0 COMPLETION OF THE PROPOSED ACQUISITION Barring unforeseen circumstances and subject to the receipt of all relevant approvals, the Board envisages that the Proposed Acquisition will be completed in the second quarter of 2011. 8.0 APROVALS FOR THE PROPOSED ACQUISITION The Proposed Acquisition is conditional upon obtaining the State Authority to the transfer of the Property to T H Hin. The Proposed Acquisition is not subject to the approval of the shareholders of Milux. 9.0 HIGHEST PERCENTAGE RATIO APPLICABLE The highest percentage ratio applicable to the Proposed Acquisition pursuant to Paragraph 10.02(g) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad is 5.99%. 10.0 DIRECTORS’ RECOMMENDATION The Directors of Milux are of the opinion that the Proposed Acquisition is in the best interest of Milux after taking into consideration the rationale and the relevant aspects of the Proposed Acquisition. 11.0 DOCUMENT FOR INSPECTION The Agreement will be made available for inspection at the registered office of Milux at 1st Floor, Lot 1, Persiaran Sg. Buloh, Taman Sains Selangor 1, Kota Damansara, 47810 Petaling Jaya, Selangor during office hours from Mondays to Fridays (except public holiday) for a period of 3 months from the date of this announcement. This announcement is dated 1 December 2010.
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