PETALING JAYA: AMMB Holdings Bhd’s (AMMB) wholly owned subsidiaries AmBank (M) Bhd and AmBank Islamic Bhd are disposing of their non-performing loans/financing along with all interest, rights, benefits and entitlement to Aiqon Capital Group Sdn Bhd’s special purpose vehicles (SPV) for an aggregate amount of RM553.91 million.
The proposed disposal is part of the debt recovery strategy of Ambank and Ambank Islamic to strengthen their loan and financing management, resolution process and to monetise the portfolio. The proceeds from the disposal will be used for general working capital purpose within a year of completion of the exercise.
AMMB told the stock exchange that its units had signed two separate sale and purchase agreements in relation to the disposal with Aiqon Amanah Sdn Bhd and Aiqon Islamic Sdn Bhd, respectively.
The Aiqon SPVs are established as the special purpose vehicles to purchase and manage the portfolio. The shareholders of Aiqon Capital are Zetovest Sdn Bhd (50%) and Kurnia Quantum (50%).
It is a related party transaction by virtue of the Aiqon SPVs being companies controlled by a person connected to a director and major shareholder of AMMB.
The headline purchase price comprises RM428.11 million for the Ambank portfolio and RM125.8 million for the one of AmBank Islamic.
The portfolio consists of 537,068 accounts and is fully written off in the books of AmBank and AmBank Islamic. It comprises customers who are individual and corporation borrowers, including debt and financing owed by sole proprietors, partnerships, individual guarantors for corporations and small and medium enterprises.
These are for products such as industrial hire purchase, small and medium industry loans and financing, auto financing, mortgage, personal loan/financing under cooperative and credit cards.
AMMB said the headline purchase price falls within the valuation range of RM450 million to RM570 million for the portfolio as appraised by KPMG Corporate Advisory Sdn Bhd, the financial adviser to AmBank and AmBank Islamic.
Barring any unforeseen circumstances, the proposed disposal is expected to be completed by March 31, 2019.
AMMB gained 0.46% to close at RM4.33 today with 1.25 million shares done.
