Transactions (Chapter 10 Of Listing Requirements):Related Party Transactions
|Subject||TRANSACTIONS (CHAPTER 10 OF LISTING REQUIREMENTS)
RELATED PARTY TRANSACTIONS
|Description||QL Figo Foods Sdn. Bhd. disposed a freehold industrial land to a related party namely, RubyTech Resources Sdn. Bhd. for a total consideration of RM10 million.|
The Board of Directors of QL Resources Berhad (“Company”) wishes to announce that its wholly owned subsidiary, QL Figo Foods Sdn. Bhd. (formerly known as Figo Foods Sdn. Bhd.)(Company No. 170866-K) (“Figo”) has on 26 March 2013 entered into a Sale and Purchase Agreement (“S&P”) to dispose a vacant freehold industrial land held under Geran Mukim 1082, Lot 3410, Mukim Kajang, Tempat Sungai Keladi, District of Hulu Langat, Negeri Selangor measuring approximately 141,567 square feet to a related party namely, RubyTech Resources Sdn. Bhd. (Company No.85685-W)(“RT or Purchaser”) for a total consideration of Ringgit Malaysia: Ten Million (RM10,000,000.00) only (“Proposed Disposal”).
Figo is a wholly-owned subsidiary of QL Fishery Sdn. Bhd. and its ultimate holding company being QL Resources Berhad ("QLR"). Its principal business is investment holding.
RT is a company incorporated in Malaysia on 3 June 1982, whose registered office is at No. 16A, Jalan Astaka U8/83, Bukit Jelutong, 40150 Shah Alam, Selangor Darul Ehsan. Its principal business is an investment holding.
The directors and shareholder of RT as follows:
a) Chia Song Swa
b) Chia Mak Hooi
Wholly owned by Ruby Technique Sdn. Bhd. whose holding company is CBG Holdings Sdn. Bhd. ("CBG"). The other shareholder of Ruby Technique Sdn. Bhd. is Farsathy Holdings Sdn. Bhd.("Farsathy")
CBG is a major shareholder of QLR.
The directors and shareholders of CBG who are also directors of QLR are as follows:
a) Chia Song Kun Director Shareholder (16.88%)
b) Chia Song Swa Director Shareholder (8.00%)
c) Chia Song Kooi Director Shareholder (8.00%)
d) Chia Mak Hooi Director Shareholder (2%)
The directors and shareholders of Farsathy who are also directors of QLR are as follows:
a) Chia Seong Pow Director Shareholder (20%)
b) Chia Seong Fatt Director Shareholder (20%)
4. Details of the Proposed Disposal
This transaction is carried out on an arm’s length basis and the consideration was based on the recommended market value as stated in the Valuation Report by Messrs CH Williams Talhar & Wong dated 19 March 2013.
Based on the Valuation Report, the market value of the vacant freehold industrial land and free from all encumbrances is RM10,000,000.00. The method of Valuation is based on Comparison Method.
The original cost of investment of the land to the Group as at 23 August 2010 is RM6,627,412.00. Henceforth, the expected gain from disposal to the Group is RM3,372,588.00. The sale proceeds will be utilised as working capital of the Group.
There are no liabilities to be assumed by RT arising from this transaction.
The consideration of Ringgit Malaysia: Ten Million (RM10,000,000.00) only shall be paid by the Purchaser to Figo as follows:
(a) Upon signing of the S&P, the Purchaser shall pay a sum of Ringgit Malaysia: One Million (RM1,000,000.00) being 10% of the total purchase price only as a deposit and part payment of the consideration to Figo (out of this amount, a sum of Ringgit Malaysia : Two Hundred Thousand (RM200,000.00) equivalent to 2% of the consideration is paid to Figo solicitors as stakeholders, to be paid to the Director-General of the Inland Revenue Department in compliance with section 21B of the Real Property Gains Tax Act, 1976);
(b) The balance of the consideration of Ringgit Malaysia: Nine Million (RM9,000,000.00) only shall be settled by the Purchaser to Figo by way of cash and/or loan within three (3) months from the date of S&P ("Completion Date"); and
(c) Figo shall deliver vacant possession of the land to the Purchaser upon full payment of the consideration.
The Proposed Disposal is to dispose of the land that was originally meant for Figo's expansion of its manufacturing of food project. However, it was subsequently decided that the expansion project will not be on this said land and therefore the land is no longer needed. This sale is in line with our stategic review to divest the non-core and non income generating assets. Further, the price agreed upon is attractive as compared to its original cost of investment.
There is no material effect on earnings per share, net assets, gearing, share capital and substantial shareholdings of the Company.
8. Approvals Required
No approval from the shareholders of QLR and/or relevant authorities is required for the Proposed Disposal.
Save as disclosed in paragraph 3 above, none of the other Directors, substantial shareholders of the Company and QLR, or persons connected to such Directors or substantial shareholders have any interest, direct or indirect in the above transaction. The interested directors have abstained from stating an opinion and voting in relation to the transaction.
The Proposed Disposal is expected to be completed within three (3) months from the date of S&P.
The highest percentage ratio applicable to the Proposed Disposal pursuant to paragraph 10.02(g) of the Main Market Listing Requirements is 1.23%.
The Audit Committee, having taken into consideration all aspect of the Proposed Disposal, was of the view that it is in the best interest of the Company, fair, reasonable and on normal commercial terms and not detrimental to the interest of the minority shareholders.
The Board of Directors (save for the interested Directors) is of the opinion that the Related Party Transaction is in the best interest of the Company.
There are no other transactions previously.
15. Documents for inspection
The S&P and the valuation report for the Proposed Disposal will be made available for inspection at the registered office of the Company at No.16A, Jalan Astaka U8/83, Bukit Jelutong, 40150 Shah Alam, Selangor during normal business hours for a period of one month from the date of announcement.
|Company Name||QL RESOURCES BERHAD|
|Date Announced||26 Mar 2013|