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Transocean Holdings Berhad Disposal of Property by a subsidiary

TRANSOCEAN HOLDINGS BHD

Type

Announcement
SubjectTransocean Holdings Berhad
Disposal of Property by a subsidiary

Contents :

INTRODUCTION

      The Board of Directors of Transocean Holdings Berhad (“THB” or “the Company”) wish to inform the Exchange that a subsidiary of the Company, namely Transocean Biotec Research Sdn Bhd (Company No. 44271 A) (“TBRSB” or “the Vendor”), had on 21 September 2005 entered into a Sale and Purchase Agreement (“SPA”) with A & P Acquarium System (M) Sdn Bhd (Company No. 370306 W) (“ASSB” or the Purchaser”) for the disposal of all that piece of land known as Lot No. 293, Mukim 4, Daerah Barat Daya, Pulau Pinang held under Geran Mukim No.G.M. 2 measuring approximately 84,419.28 square feet (1.938 acres) (“the Property”) for a total consideration of Ringgit Malaysia Seven Hundred and Forty Two Thousand Eight Hundred and Eighty Nine and Sen Sixty Six (RM742,889.66) only (hereinafter referred to as “the Disposal”).


2. INFORMATION ON TBRSB
      TBRSB was incorporated on 4 January 1979 as a private limited company under the Companies Act, 1965. As at todate, TBRSB’s authorised share capital is RM1,000,000.00 comprising 1,000,000 ordinary shares of RM1.00 each, of which RM715,000.00 comprising 715,000 ordinary shares of RM1.00 have been issued and are fully paid up.

      TBRSB is presently a wholly-owned subsidiary of Transocean Biotec (M) Sdn Bhd (“TBM”) and 75% of the equity interests in TBM are held by Transocean (M) Sdn Bhd, a wholly-owned subsidiary of THB.

      The existing directors of TBRSB are Mr. Liew Yong Heong and Mr. Tung Sing Hong who is also the Chairman and Managing Director of the THB.

3. INFORMATION ON THE PROPERTY
      The Property under the Disposal is all that piece of land known as Lot No. 293, Mukim 4, Daerah Barat Daya, Pulau Pinang held under Geran Mukim No. G.M. 2 measuring approximately 84,419.28 square feet (1.938 acres).

      TBRSB is the registered owner of the Property. The Property is presently charged to Bank Bumiputra Malaysia Berhad vide persn No. 85/1984 Jil 3 Fol 78 and persn No. 86/1984 Jil 3 Fol 79.

4. SALE CONSIDERATION, BASIS AND TERMS OF PAYMENT
      The Property is sold at an agreed purchase price of Ringgit Malaysia Eight and Sen Eighty (RM8.80) only per square foot totalling Ringgit Malaysia Seven Hundred and Forty Two Thousand Eight Hundred and Eighty Nine and Sen Sixty Six (RM742,889.66) only (“Total Sale Consideration”).

      The Total Sale Consideration was arrived at on a willing buyer and willing seller basis and shall be payable by the Purchaser to TBRSB in the following manner:

      4.1 Upon the execution of SPA, the Purchaser shall pay to the Vendor the deposit sum of Ringgit Malaysia Seventy Four Thousand Two Hundred and Eighty Eight and Sen Ninety Seven (RM74,288.97) only (hereinafter referred to as “Deposit Sum”), being a 10% deposit towards the Total Sale Consideration.
        4.2 The balance consideration of Ringgit Malaysia Six Hundred Sixty Eight Thousand Six Hundred and Sen Sixty Nine (RM668,600.69) only (“Balance Consideration”) shall be payable by the Purchaser to the Vendor within three months from the date of the SPA with an extension of one month at interest rate of 6% per annum calculated on daily basis on the unpaid balance.

    5. EFFECTS OF THE DISPOSAL
        5.1 Loss Per Share (“LPS”)

            The Disposal is expected to result in a loss to THB Group of RM142,701.51 for the financial year ending 31 May 2006. The Disposal is not expected to have any material effect on the earnings / loss per share of the Company for the financial year ending 31 May 2006.
        5.2 Net Tangible Assets (“NTA”) per share

            The Disposal is not expected to have any material effect on the NTA per share of the THB Group for the financial year ending 31 May 2006.
        5.3 Substantial Shareholders’ Shareholding and Share Capital of the Company

            As the Total Sale Consideration will be satisfied entirely in cash, there will be no effect on the Company's substantial shareholders' shareholding and share capital of the Company.

    6. DETAILS OF THE DISPOSAL
        6.1 Expected loss arising from the Disposal
            Based on the Total Sale Consideration of RM742,889.66, the Disposal is expected to result in a loss to THB Group amounting to RM142,701.51 for the financial year ending 31 May 2006.

        6.2 Utilization of Proceeds
            The proceeds from the Disposal will be used to repay bank borrowings secured against the same and inter-company loans.


    7. APPROVALS REQUIRED

        No approval is required from the shareholders of THB given that the Total Sale Consideration is below the applicable percentage ratio requiring the approval of shareholders.

    8. INTERESTS OF DIRECTORS, SUBSTANTIAL SHAREHOLDERS AND/OR PERSONS CONNECTED WITH THEM

        None of the directors, substantial shareholders and/or persons connected with them has any direct or indirect interest in the Disposal.


    9. RATIONALE FOR THE DISPOSAL
        As part of the de-gearing exercise of the Group, it will be the best interests for the Company to dispose of the said non-income generating assets and to proceed with the Disposal.

    10. SALIENT FEATURES OF THE SPA

    The salient terms and conditions of the SPA are as follows:
        i) 10% deposit of the Total Sale Consideration of RM74,288.97 (“the Deposit”) shall be payable by Purchaser to the Vendor upon the execution of the SPA.

        ii) The Balance Consideration shall be payable by the Purchaser to the Vendor within three months from the date of the SPA with an extension of one month at interest of 6% per annum calculated on daily basis on the unpaid balance.

        iii) The Vendor shall deliver vacant possession of the Property to the Purchaser upon full payment of the Balance Consideration by the Purchaser.

        iv) In the event the Purchaser fails to pay the Balance Consideration, the Vendor is entitled to forfeit the Deposit absolutely as agreed liquidated damages and not by way of penalty and the Vendor shall at the same time of such forfeiture, refund to the Purchaser a sum equal to all instalments of the balance purchase price (if any) already paid by the Purchaser under the SPA up to the date of such default, whereupon the SPA shall be treated as null and void.

    11. STATEMENT BY DIRECTORS

        The Board of Directors is of the view that after having considered the proposal from the Purchaser, the Disposal as detailed in this announcement is in the best interest of THB Group.

    12. ESTIMATED TIME FRAME FOR COMPLETION

        The parties agree that the SPA must be completed within three (3) months from the date of signing thereof with any extension to be subject to mutual agreement.


    13. DEPARTURE FROM POLICIES AND GUIDELINES ON ISSUE/OFFER OF SECURITIES OF THE SECURITIES COMMISSION (SC GUIDELINES)

        The SC Guidelines is not applicable as the Disposal is satisfied wholly in cash and the said Disposal will not result in a significant change in THB Group’s business direction.

    14. OTHER INFORMATION
      14.1 Listing requirement of the minimum paid-up capital
          As stipulated under the Securities Commission’s Policies and Guidelines on Issue/Offer of Securities and the Bursa Malaysia Securities Berhad (“Bursa Securities” or “the Exchange”)’s Listing Requirements, the minimum issued and paid-up capital of a company listed on the Second Board of Bursa Securities shall be RM40.00 million.

          On 30 June 2004, the Company was categorized as an undercapitalized company as its paid-up share capital is RM29.00 million. The Exchange had approved the application of the Company for extension of time until 30 September 2006 to comply with Paragraph 8.16A of the Listing Requirements vide its letter to the Company dated 11 May 2005.


      15. DOCUMENTS AVAILABLE FOR INSPECTION
          A copy of the SPA dated 21 September 2005 is available for inspection at the registered office of the Company at Suite 18.05, MWE Plaza, No. 8 Lebuh Farquhar, 10200 Penang during normal office hours from Monday to Friday (except public holidays) for a period of 2 weeks from the date of this announcement.

      This announcement is dated 21 September 2005.


      Announcement Info

      Company NameTRANSOCEAN HOLDINGS BHD  
      Stock Name TOCEAN    
      Date Announced21 Sept 2005  
      CategoryGeneral Announcement
      Reference NoCU-050921-58534



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