PETALING JAYA: QL Resources Bhd’s wholly owned subsidiary QL Green Resources Sdn Bhd (QLGR) is extending a conditional mandatory takeover offer to acquire all the shares it does not own in Boilermech Holdings Bhd for 95 sen per share.
QLGR yesterday entered into an unconditional share acquisition agreement with Boilermech managing director and substantial shareholder Leong Yew Cheong to acquire a 4% stake in Boilermech for RM19.61 million cash or 95 sen per Boilermech share, raising QLGR’s stake from 44.15% to 48.15%.
The proposed acquisition will be financed with internally generated funds and/or borrowings. Trading in QL’s shares will resume tomorrow after it was suspended today.
QLGR intends to maintain the listing status of Boilermech on the Main Market of Bursa Securities. It does not intend to compulsorily acquire any remaining offer shares from the holders who have not accepted the offer even if the conditions are fulfilled.
“The proposals are undertaken by QL group as part of its strategy to increase its exposure to businesses within the environmental, social and governance (ESG) sector. With an increased stake, QL is expected to benefit from accretive and larger earnings contribution from Boilermech,” QL said in a stock exchange filing.
Boilermech has been expanding its footprint in the clean energy and sustainable technology sector by diversifying its biomass engineering portfolio into the water treatment sector and solar energy industry. The board envisages that the biomass and solar energy sectors will provide a strong growth impetus to Boilermech group due to the rising demand as the preferred renewable energy sources.
“QL Group is confident that Boilermech will continue to grow and cement its position as a leading clean energy and environmental technology specialist in Malaysia. The board believes that Boilermech is well positioned to participate in the megatrend of clean energy and sustainable technology growth.
“All in all, the proposals represent a good opportunity for QL group to further increase its strategic investment in Boilermech.”
The offer provides the holders with liquidity opportunity to realise their investments in Boilermech for cash at the offer price, with premiums ranging from 3.38% to 47.91% over the five-day volume weighted average price (VWAP), one-month VWAP, three-month VWAP, six-month VWAP and 12-month VWAP of Boilermech shares.
The takeover is expected to be completed in the first quarter of 2021.