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KUB sells Mukah land, assets for RM44.8m

23 Jul 2019 / 13:45 H.

PETALING JAYA: KUB Malaysia Bhd is disposing of a piece of land measuring 60 hectares as well as a factory, ancillary equipment and machineries in Mukah, Sarawak for a total of RM44.8 million.

The selling prices for the factory and land are RM43 million and RM1.8 million, respectively.

KUB told Bursa Malaysia that its subsidiaries KUB Maju Mill Sdn Bhd (KUBMA) and KUB Sepadu Sdn Bhd (KUBS) had respectively entered into the sale and purchase agreements (SPAs) with Sinong Pelita Oil Mill Sdn Bhd (SPOM) for the disposal of the factory and land.

KUB Agro Holdings Sdn Bhd, which is a wholly-owned subsidiary of KUB Ekuiti Sdn Bhd (KUBE), has 60% and 66% effective interests in KUBS and KUBMA respectively. KUBE is a wholly-owned subsidiary of KUB.

KUB said the sale of the factory will enable the group to eliminate its underperforming assets and reduce cash outflow and deterioration of financial performance.

“KUBMA will be able to reduce its debts and interest expense significantly.”

Meanwhile, it noted that the sale of the land will enable KUBS to monetise the assets at better value since the price offered by SPOM is commercially attractive.

“In addition, the sale is to facilitate the implementation of the factory SPA by KUBMA, in which KUBS has a 6% equity.”

KUB said the proceeds to KUBMA will be utilised to settle its bank borrowings and reduce other debts, while the proceeds to KUBS will be used for operational requirements.

At the noon break, KUB’s share price was unchanged at 38 sen on 777,000 shares done.

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