Versatile Creative plans to dispose of stake in Iris Corp

PETALING JAYA: Versatile Creative Bhd’s (VCB) wholly owned subsidiary Versatile Paper Boxes Sdn Bhd is planning to dispose of its 3.98% equity interest in Iris Corp Bhd, on the grounds of the stake being a non-core investment, which will help increase VCB’s funds.

“The directors believe that monetising the non-core stake in Iris Corp is beneficial as it is expected to provide the VCB Group with additional funding to pursue other investments,” VCB’s board said in a Bursa Malaysia filing.

The group intends to use the proceeds from the proposed disposal which is expected to amount to RM16.24million, to repay bank borrowings, purchase new equipment and machinery and foot the disposal expenses.

VCB which has not identified a potential purchaser is planning to dispose of the shares either through the open market, off-market transactions or a combination of both of the above.

The proposal is subject to shareholders' approval.

“The disposal of the entire (stake) is expected to increase the earnings and earnings per share of the VCB Group in the financial year the disposal takes place as it is expected to realise a one-off gain on disposal based on the indicative disposal price of RM0.165. However, the actual gain to the VCB Group arising from the disposal cannot be determined at this juncture as it is dependent on the actual number of Iris Corp’s shares to be disposed of and the respective disposal price(s),” the board said.

VCB’s shares gained by 1.27% to close at 79.5 sen with some 53,500 shares changing hands. Its market capitalisation stood at RM93.28million.