Berjaya Corp to raise stake in Berjaya Land to 75.05%

PETALING JAYA: Berjaya Corp Bhd (BCorp) proposes to raise its stake in Berjaya Land Bhd to 75.05% by acquiring Tan Sri Vincent Tan Chee Yioun and Penta Investment Advisers Ltd’s 12% interest, for RM419.11 million or 70 sen per BLand share.
In a filing with Bursa Malaysia yesterday, BCorp said it and its wholly-owned subsidiary Juara Sejati Sdn Bhd have entered into separate conditional share sale agreements with Tan and Penta.
The purchase consideration will be satisfied by the issuance of RM353.25 million 10-year 2% irredeemable convertible unsecured loan stocks (new ICULS) at 100% of its nominal value together with 706.5 million free detachable warrants in BCorp.The remaining RM65.86 million will be satisfied in cash, which will be funded through borrowings.
“The proposed acquisition enables the BCorp Group to further increase its equity interest in BLand at a reasonable value as the board believes that there is potential capital appreciation in the properties held by the group,” it said.
The new ICULS and new warrants, collectively referred to as consideration securities, will be listed on the Main Market of Bursa Malaysia. Due to the listing, there must be at least 100 holders holding not less than one board lot each of the respective securities.
BCorp said Tan intends to distribute board lots of such new ICULS and new warrants to be held by him without any consideration to enable their listing.
“The issuance of the consideration securities will minimise any immediate cash outflow. In addition, any conversion of the new ICULS and/or exercise of new warrants will further strengthen BCorp’s capital base, improve its gearing as well as improve the liquidity of the BCorp shares,” it said.
The proceeds arising from the exercise of the new warrants is dependent upon the actual number of new warrants exercised. BCorp said the proceeds from this exercise will be used as working capital for the group.
The proposed acquisition will dilute the earnings per share of the group for the financial year ending April 30, 2016 and is expected to be completed in the second quarter of 2016.