Kuantan Flour Mills signs MoU with Lotus Essential as deadline looms

PETALING JAYA: Practice Note 17 company Kuantan Flour Mill Bhd (KFM), which has been in the news following Felcra Bhd’s interest and later disinterest, has inked a memorandum of understanding (MoU) with Lotus Essential Sdn Bhd to cooperate in flour milling and trading of flour and food-related products.
Lotus is involved in import, export and trading of steam coal, corn and tapioca starch.
The clock is ticking for KFM which has requested more time to submit its regularisation plan to Bursa Malaysia. The current deadline is Dec 31, 2016.
As part of the proposal to restructure its debt and reconstruct its business, KFM is proposing to, among others, carry out an equity fundraising exercise via a rights issue and special issue of its shares.
In a filing with the stock exchange, KFM said the MoU sets out the mutual understanding and intention of both parties to initiate further discussions to enter into one or more agreements and to establish the main commercial points which have been agreed as the basis of the cooperation and collaboration.
KFM and Lotus will negotiate the terms and conditions of the definitive agreement to be entered into and endeavour to execute the definitive agreement within six months from the signing of the MoU.