Nationwide Express makes second bid to acquire Airpak

PETALING JAYA: Nationwide Express Holdings Bhd (NEHB) is making a second bid to acquire Airpak Express (M) Sdn Bhd’s courier service business after the aborted merger last May.
The acquisition will be satisfied by RM15 million cash and the issuance of 3 million NEHB shares.
In a filing with Bursa Malaysia today, NEHB said its wholly owned subsidiary Nationwide Express Distribution Sdn Bhd (NEDSB) has entered into a conditional acquisition agreement with Airpak to acquire all its rights, title and interest in and to its courier service business, including certain assets and liabilities of Airpak.
The assets included are furniture and fittings, motor vehicles, office equipment, computer hardware and software, renovations, cash and bank balances, fixed deposits as well as other receivables amounting to RM1.1 million and liabilities comprising hire purchase amounting to RM411,308 as at April 30, 2017.
Concurrently, NEDSB also entered into an advisory agreement to appoint Ong Eng Lee, the current managing director and controlling shareholder of Airpak, as an advisor on an exclusive basis, effective from the date of completion of the acquisition agreement.
NEHB said the proposed acquisition is part of the group’s overall strategy to capitalise on the rapid growth in demand for e-commerce and online business activities.
“With the growing number of new online market places, the proposed acquisition is timely for the company to build its capabilities and capacities in the business-to-consumer segment and thereby, enhance revenue growth from the e-commerce last mile delivery services,” it said.
The proposed acquisition will be funded through internally generated funds and/or bank borrowings and is expected to be completed by the first quarter of 2018.
The Airpak Group recorded lower profit attributable to the group of RM1.02 million for the financial year ended July 31, 2016 against RM1.65 million a year ago, due to the under recorded expenses for prior year.
NEHB’s share price rose 10% to close at 77 sen today with a total of 166,200 shares traded, giving it a market capitalisation of RM92.58 million.