INTRODUCTION
The Board of Directors of QL Resources Berhad is pleased to announce that HLPF, a wholly owned subsidiary of the Company, will be acquiring 880,000 ordinary shares of RM1.00 each representing 20% equity interest in QLRPF for a total consideration of RM1,476,000.
2. INFORMATION ON QLRPF
QLRPF was incorporated in Malaysia as a private limited company under Companies Act, 1965 on 11 August 1992. QLRPF is currently a 80% subsidiary of QL Feedingstuffs Sdn. Bhd., a wholly owned subsidiary of QL Resources Berhad. The re-structuring will entails HLPF acquiring 100% equity interest in QLRPF resulting in QLRPF being a wholly owned subsidiary of HLPF. The authorised share capital of QLRPF is 5,000,000 ordinary shares of RM1.00 each of which 4,400,000 are issued and fully paid.
The principal activities of QLRPF is poultry farming.
3. DETAILS OF THE ACQUISITION
3.1 Details of the shares to be acquired
HLPF proposed to acquire 880,000 ordinary shares of RM1.00 each from its Director namely Mr Tan Eng Hai, a total of 20% equity interest in QLRPF for a total consideration of RM1,476,000.
The shares acquired shall be free from all charges, liens, pledges, trust and other encumbrances and with all rights, benefits, entitlements attaching thereto.
3.2 Basis of arriving at the purchase consideration
The purchase consideration for the proposed acquisition was derived at on a willing buyer-willing seller basis based on unaudited adjusted NTA of QLRPF as at 31 August 2008.
The total purchase considerations of RM1,476,000 shall be paid by HLPF to Mr Tan Eng Hai in a lump sum upon signing the transfer of shares form.
The Proposed Acquisition shall be financed by a combination of internal generate funds and bank borrowings.
4. RATIONALE
Presently, QL Feedingstuffs holds 80% equity interest in QLRPF. The proposed acquisition will enable QL to consolidate 100% of the future profits of QLRPF into QL Group.
5. FINANCIAL EFFECTS
Share capital and substantial shareholders
The proposed acquisition will have no effect on the issued and paid-up of QL and shareholdings of QL's substantial shareholders as it is a cash transaction.
Net Asset & Gearing
The proposed acquisition will not have any material impact on the NA and gearing of the QL Group.
Earnings
The proposed acquisition will not have any material impact on the earnings of QL Group for the financial year ending 31 March 2009 but is expected to contribute positively to the future earnings of QL Group.
6. APPROVALS REQUIRED
HLPF shall obtain approval from its shareholders and Board of Directors on the proposed acquisition. No other approval from the shareholders and authorities of the Company is required for the Related Party Transaction.
7. DIRECTORS' AND SUBSTANTIAL SHAREHOLDERS INTEREST
Mr Tan Eng Hai is a Director of HLPF & QLRPF and a shareholder of QLRPF. None of the Directors, major shareholders of QL and/or persons connected to them is interested in the proposed acquisition.
8. STATEMENT BY DIRECTORS
The Directors of QL are of the opinion that the proposed acquisition is in the best interest of the QL Group.
9. DATE OF COMPLETION
The proposed acquisition is expected to be completed by end of the year.
10.DEPARTURE FROM GUIDELINE
To the best knowledge of the Company, the proposed acquisition has not departed from the Offering of Equity & Equity Linked Securities issued by the Securities Commission.
The announcement is dated 23 October 2008.
