PETALING JAYA: Amtel Holdings Bhd via its wholly owned subsidiary plans to buy an 8.094-hectare agricultural land parcel in Muallim, Perak for RM23mil in cash from a company associated with executive director and group CEO Chester Koid Siang Loong, as part of the group’s expansion into motor vehicle manufacturing.
In a filing with Bursa Malaysia, the company said Amtel Cellular Sdn Bhd had entered into a conditional sale and purchase agreement with Kat Ventures Sdn Bhd for the proposed acquisition, which is classified as a related-party transaction.
Kat Ventures is in the process of converting the land’s designation from agricultural to industrial use.
The acquisition is aimed at supporting the development of a factory for Amtel’s vehicle manufacturing operations.
Currently, the group operates from a leased facility in Gurun, Kedah, and depends on subcontractors for part of its sub-assembly activities as well as extra storage space.
Koid holds an 80% stake in Kat Ventures Sdn Bhd, while Datuk Ang Tune Hoe and Teh Tzun Tzin each own 10%.
Separately, Amtel Holdings Bhd announced that it has signed a conditional subscription agreement with Koid involving the issuance of 45 million new shares at 33 sen each, which is expected to raise RM14.85 million.
The subscription price is at a 0.33% premium to the stock’s five-day volume-weighted average price of 32.89 sen as of May 25.
Upon completion of the exercise, Koid’s direct shareholding in Amtel is projected to increase from 7.51% to between 36.41% and 37.15%. Koid and the parties acting in concert plan to apply to the Securities Commission Malaysia for a waiver from the obligation to undertake a mandatory general offer for the company’s remaining shares.
Amtel said the funds raised will be utilised to replenish internally generated funds used and/or repay bank borrowings.