Texchem to sell stake in pesticide units

PETALING JAYA: Texchem Resources Bhd is divesting its stake in two household insecticide firms for a total of RM80.5 million.

In a filing with the stock exchange, Texchem said it is disposing a 30% stake in Fumakilla Asia Sdn Bhd (FASB) for RM61.5 million and 26.36% in PT Fumakilla Nomos (PTFN) to Fumakilla Ltd for RM19 million.

Texchem said the proposal will enable the group to recognise a net gain of about RM16.7 million or 13.68 sen per share at the group level based on its audited consolidated financial statements ended Dec 31, 2015 and audited financial statements of FASB and PTFN for the period ended June 30, 2016.

Of the disposal proceeds, Texchem said RM6.09 million will be utilised for its special dividend payout of 5%; RM10.14 million for repayment of bank borrowings; RM20 million for working capital and RM42.92 million for investment in existing divisions.

Texchem said the disposal will enable it to unlock the value of its non-core business and reinforce its existing businesses.