Fututech Berhad’s shareholders approved RM458 million acquisitions and private placement proposal of 100 million new shares


Fututech Berhad’s shareholders approved RM458 million acquisitions and private placement proposal of 100 million new shares

Kuala Lumpur, 20 January 2016 – Fututech Berhad (“Fututech” or the “Company”) a notable construction and property development company today received full shareholders’ approval for its proposed acquisition of the entire equity interest in Kerjaya Prospek (M) Sdn Bhd (“Kerjaya Prospek”) and Permatang Bakti Sdn Bhd (“Permatang Bakti”) (“Proposed Acquisitions”) for a total purchase consideration of RM458.0 million.

Now with shareholders’ approval secured, the Proposed Acquisitions is targeted to be completed by February 2016.

“The acquisition exercise is our plan to further enhance Fututech’s construction earnings moving forward.  Furthermore, Kerjaya Prospek has fostered a portfolio of notable high-end construction projects. With our combined resources and expertise, I believe we can continue to secure bigger projects in the future.” said Datuk Tee Eng Ho, the Executive Chairman of Fututech.

The total purchase consideration of RM458.0 million will be satisfied as follows: –

1. Acquisition of Kerjaya Prospek for a consideration of RM438.0 million

a)      RM35.2 million in cash

b)      RM42.8 million via the issuance of Fututech Shares at an issue price of RM1.16 per Share

c)       RM360.0 million via the issuance of new Redeemable Convertible Preference Shares of RM0.50 each in Fututech (“RCPS”) at an issue price of RM1.16 per RCPS

The issue price of RM1.16 per Fututech Share and RCPS was arrived at based on a 9.21% premium to the 30-day volume weighted average market price of the Fututech Shares up to the market day preceding the date of the heads of agreement signed on 6 February 2015.

2. Acquisition of Permatang Bakti for a cash consideration of RM20.0 million

The total cash consideration of RM55.2 million for the Proposed Acquisitions is expected to be funded from the proceeds raised from the Proposed Private Placement.

Fututech’s current order book stands at RM97.1 million, while the combined construction order book for Kerjaya Prospek and Permatang Bakti is RM2.62 billion, thus giving an enlarged construction order book of RM2.70 billion once the Proposed Acquisitions is completed.

In addition to the Company’s Proposed Acquisitions, Fututech’s shareholders have also approved the Proposed Private Placement entailing 100 million new Fututech Shares at an issue price to be determined and to placee (s) to be identified at a later stage.

The Proposed Private Placement will enable the Company to raise the required funds in a cost effective manner for its Proposed Acquisitions and other working capital needs for the enlarged Group. Additionally, the Proposed Private Placement is aimed to improve the institutional shareholdings mix in Fututech and the liquidity of Fututech Shares as well as to reposition Fututech Shares in the investment community. 

After the completion of the Proposed Private Placement, Fututech’s enlarged share capital will increase to approximately 538 million shares, on a diluted effect assuming full conversion of the RCPS. The Proposed Private Placement is expected to be completed by March 2016.

AmInvestment Bank Berhad (“AmInvestment Bank”) and Astramina Advisory Sdn Bhd have been appointed as the Joint Advisers for the Proposals.

CIMB Investment Bank Berhad (“CIMB IB”) has been appointed as the Sole Global Coordinator while CIMB IB and AmInvestment Bank were appointed as the Joint Placement Agents for the Proposed Private Placement.

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