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INTRODUCTION
Pursuant to the announcements made on 4 October 2010 and 6 October 2010, the Board of Directors of QL Resources Berhad ("QL" or "Company") wishes to announce that its wholly owned subsidiary, QL Green Resources Sdn Bhd (formerly known as Tong Her Marine Products Sdn Bhd) ("QLGR") had on 21 October 2010 entered into a Share Sale and Purchase Agreement ("SSPA") with Boilermech Holdings Berhad ("BHB") to swap its entire 40.51% equity interest in BSB comprising 202,559 ordinary shares of RM1.00 each in Boilermech Sdn Bhd ("BSB") for a proportionate 40.51% equity stake comprising 90,381,818 new ordinary shares of RM0.10 each in BHB, a newly incorporated company.
As a result of the Share Swap, BSB will become a wholly owned subsidiary of BHB and QLGR’s interest in BSB will be held indirectly via BHB.
INFORMATION ON BHB
BHB was incorporated in Malaysia on 8 April 2010 under the Companies Act, 1965. It was converted from a private limited company to a public company on 14 May 2010. BHB is an investment holding company incorporated to facilitate the listing of BSB. The authorized share capital of BHB is RM50,000,000 comprising of 500,000,000 ordinary shares of RM0.10 each (“BHB Shares”). The issued and paid up share capital is RM2 comprising 20 BHB Shares.
DETAILS OF THE SHARE SWAP
The share swap entails the issuance of 223,099,980 new BHB Shares to all the shareholders of BSB on a proportionate basis. The basis for the share swap was arrived at after taking into consideration the net assets of BSB as at 31 August 2010 of approximately RM22.31 million.
As a result of the Share Swap, QLGR will hold a 40.51% direct stake in BHB comprising 90,381,818 BHB Shares. BHB has proposed to undertake an Initial Public Offering exercise which will involve the listing of and quotation for BHB's enlarged issued and paid-up capital on the ACE Market of Bursa Malaysia Securities Berhad (“Proposed Listing”).
The Proposed Listing is not subject to the approval of the shareholders of QL as BSB is only an associate company of QLGR.
RATIONALE FOR THE SHARE SWAP
The Share Swap is an internal reorganization and restructuring scheme undertaken by BHB and the shareholders of BSB in order to facilitate the Proposed Listing. As a result of the Share Swap, BSB will become a wholly owned subsidiary company of BHB and QLGR’s interest in BSB will be held indirectly via BHB. The Proposed Listing of BHB will enable BHB to tap the equity capital market and raise funds for future expansion and growth.
EFFECTS OF THE SHARE SWAP
The Share Swap is not expected to have any material effect on the share capital, substantial shareholders shareholdings, net assets per share, gearing and earnings per share of QL for the financial year ending 31 March 2011.
APPROVAL REQUIRED AND THE APPLICATION TO THE RELEVANT AUTHORITIES
The Share Swap is not subject to the approval of shareholders of QL or other relevant authorities. BHB will submit the relevant applications to the regulatory authorities in relation to the Proposed Listing in due course.
DIRECTORS’ AND/OR MAJOR SHAREHOLDERS INTEREST AND/OR PERSONS CONNECTED TO SUCH DIRECTORS AND MAJOR SHAREHOLDERS
None of the directors and/or major shareholders of QL and/or persons connected with such directors and/or major shareholders has any interest, direct or indirect in the Share Swap.
DIRECTORS STATEMENT
After taking into consideration all aspects of the Share Swap, the Board is of the opinion it is in the best interest of the Company.
TIME FRAME FOR COMPLETION OF THE SHARE SWAP
The Share Swap has completed today.
This announcement is dated 21 October 2010. |
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