PETALING JAYA, 7 June: KUB Malaysia Bhd is exiting its engineering and construction business with the disposal of the entire stake in KUB Precast Sdn Bhd for RM19 million.
In a filing with the stock exchange, the company said it had entered a share acquisition agreement with Jeks Precast Sdn Bhd for the disposal of 13.38 million shares in KUB Precast.
The disposal is in line with KUB’s strategy to dispose of its non-performing assets to further improve its profitability and the proceeds from the sale are planned to be utilised to finance the working capital and capital expenditure particularly for its core businesses, namely agro, energy and ICT.
“Following the divestment of KUB Builders Sdn Bhd in December 2015, we re-examined the overall viability of maintaining our continued presence in the Engineering and Construction sector. After extensive internal deliberation, and considering our new strategic direction, we decided to exit this sector altogether,” said KUB president and group managing director Datuk Abdul Rahim Mohd Zin.
KUB Precast is primarily engaged in the business of manufacturing and trading of precast concrete slabs and concrete elements largely sold to the construction industry. For the financial year ended December 31, 2015, KUB Precast reported a loss before tax of RM5.32 million.
Jeks Precast will assume the liabilities encompassing trade creditors as at April 30, 2016 of RM6.1 million, other creditors of RM1.2 million and borrowings of RM4.2 million following the completion of the disposal.
— THE SUN