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Acquisition of land including the building attached, bearing the postal address of Unit B/08/DF, Garden Shopping Arcade, Central Park, Indonesia for a cash consideration of IDR4,970,000,000 (equivalent to RM1,739,500) by PT. Natbio Marketing Indonesia (“PTNMI”), a wholly-owned subsidiary of Power Root Berhad (formerly known as Natural Bio Resources Berhad) (“Power Root” or “the Company”) from PT. Sun International Capital (“Vendor” or “PTSIC”) (“Acquisition”)

POWER ROOT BERHAD

TypeAnnouncement
SubjectAcquisition of land including the building attached, bearing the postal address of Unit B/08/DF, Garden Shopping Arcade, Central Park, Indonesia for a cash consideration of IDR4,970,000,000 (equivalent to RM1,739,500) by PT. Natbio Marketing Indonesia (“PTNMI”), a wholly-owned subsidiary of Power Root Berhad (formerly known as Natural Bio Resources Berhad) (“Power Root” or “the Company”) from PT. Sun International Capital (“Vendor” or “PTSIC”) (“Acquisition”)
Contents1. INTRODUCTION

The Board of Directors of Power Root is pleased to announce that its wholly-owned subsidiary PTNMI had on 23 August 2010 entered into a Sale and Purchase Agreement (“Agreement”) for the Acquisition with the Vendor for a total cash consideration of IDR4,970,000,000 (equivalent to RM1,739,500) (“Purchase Consideration”).


2. DETAILS OF THE ACQUISITION

2.1 Details of the Property

The details of the property are as follows:

(a) Description/ Postal Address : Unit B/08/DF, Garden Shopping Arcade, Central Park, Indonesia
(b) Land size/built-up area : 807.29 square feet / 3,229.17 square feet
(c) Building : 4 storey shop office
(d) Age of building : 1 year
(e) Existing use : Vacant
(f) Encumbrances : The property is free from all charges and encumbrances

Power Root is unable to obtain the information on the net book value of the property.

2.2 Basis of Determining the Purchase Consideration

The purchase consideration of IDR4,970,000,000 (equivalent to RM1,739,500) for the Acquisition was arrived at on a willing-buyer and willing-seller basis, after taking into consideration the prevailing market value of the commercial property within the vicinity and the condition and location of the property.

No valuation was carried out on the property. The Purchase Consideration for the Acquisition was entirely satisfied by cash.

2.3 Terms of Payment

Upon execution of the Agreement, a deposit of IDR300,000,000 (equivalent to RM105,000) representing approximately 6% of the total Purchase Consideration was paid to the Vendor. The balance of the Purchase Consideration amounting to IDR4,670,000,000 (equivalent to RM1,634,500) representing 94% of the total Purchase Consideration was paid on 24 August 2010 which is also the completion date of the Acquisition.

2.4 Approvals Required

The Acquisition is not subject to the approval of the shareholders or any other relevant authorities.

2.5 Source of Funding

The Purchase Consideration is to be funded from internally generated funds.

2.6 Encumbrances

The property is to be acquired free from any encumbrances.

2.7 Liabilities to be assumed

There are no liabilities to be assumed by Power Root arising from the Acquisition.


3. INFORMATION ON THE VENDOR

PT. Sun International Capital was incorporated on 16 April 2007 under the laws of Republic of Indonesia. The principal activities of PTSIC are construction, trading, industry, transportation, services, agribusiness, technical agency, mining, printing and workshop. The authorised share capital of PTSIC is IDR300,000,000 comprising 3,000 ordinary shares of IRD100,000 each and the current issued and paid-up share capital of PTSIC is IDR100,000,000 comprising 1,000 ordinary shares of IDR100,000 each.

Power Root is unable to obtain the information on the Vendor’s original cost and date of investment of the property.


4. PROSPECTS AND RATIONALE FOR THE ACQUISITION

The acquisition of the Property will increase and provide additional operations space for the Group’s Indonesia operations.


5. RISK FACTORS

The Board of Directors does not foresee any other significant risk arising from the Acquisition.


6. FINANCIAL EFFECTS OF THE ACQUISITION

6.1 Share Capital and Major Shareholders
The Acquisition will not have any effect on the issued and paid-up share capital and the shareholdings of major shareholders as the Purchase Consideration is to be satisfied entirely by cash.

6.2 Earnings, Net Assets and Gearing

The Acquisition will not have any material effect on the earnings, net assets and gearing of the Power Root Group for the financial year ending 28 February 2011.


7. INTEREST OF DIRECTORS AND MAJOR SHAREHOLDERS AND PERSONS CONNECTED TO THEM

None of the Directors and/or major shareholders of Power Root and persons connected to them have any interest, direct or indirect, in the Acquisition.


8. DEPARTURE FROM THE SECURITIES COMMISSION’S GUIDELINES FOR THE MAIN AND SECOND BOARD MARKET (“SC GUIDELINES”)

The Acquisition has not departed from any of the requirements of the SC Guidelines.


9. STATEMENT BY DIRECTORS

The Directors of Power Root, after having considered all aspects of the Acquisition, are of the opinion that the Acquisition is in the best interest of the Power Root Group.


10. DOCUMENTS FOR INSPECTION

A copy of the Agreement is available for inspection at the registered office of Power Root at 31-04, Level 31, Menara Landmark, Mail Box 172, No. 12, Jalan Ngee Heng, 80000, Johor Bahru, Johor Darul Ta’zim from Mondays to Fridays (except public holidays) during business hours, for a period of 3 months from the date of this announcement.


This announcement is dated 27 August 2010.

Announcement Info

Company NamePOWER ROOT BERHAD  
Stock Name PWROOT    
Date Announced27 Aug 2010  
CategoryGeneral Announcement
Reference NoC&-100827-47149



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