ACQUISITION OF 51% EQUITY INTEREST IN TOP PARAMOUNT SDN. BHD.
|NV MULTI CORPORATION BERHAD|
|Subject||ACQUISITION OF 51% EQUITY INTEREST IN TOP PARAMOUNT SDN. BHD.|
Contents :1. INTRODUCTION
The Board of Directors of NV Multi Corporation Berhad ("NV Multi") is pleased to announce that NV Care (Penang) Sdn. Bhd. ("NVCP") (Company No. 470442-U), a 51%-owned subsidiary company of NV Care Sdn. Bhd. (Company No. 451196-D) ("NVC") which is a 85%-owned subsidiary company of NV Multi has on 29 August 2007 entered into a Sale and Purchase Agreement ("SPA") with Lee Kim Kiong ("LKK") to acquire 51% equity interest in Top Paramount Sdn. Bhd. (Company No. 768942-K) ('TPSB") for a total cash consideration of Ringgit Malaysia One Million Five Hundred and Thirty Thousand only (RM1,530,000) ("the Acquisition") subject to conditions under clause 2.4 below
2. TERMS OF THE ACQUISITION
2.1 INFORMATION ON NVCP
NVCP is a 51%-owned subsidiary company of NVC. It is a private limited company incorporated in Malaysia on 16 October 1998 with a current authorised share capital of RM100,000 divided into 100,000 ordinary shares of RM1.00 each and its issued and paid-up share capital is RM100 divided into 100 ordinary shares of RM1.00 each.
2.2 INFORMATION OF LKK
LKK, is the founder, managing director and major shareholder of Eight Eleven Funeral Services (M) Sdn. Bhd. ("811"), a private limited company incorporated in Malaysia on 3 August 1999 with an authorised share capital of RM100,000 divided into 100,000 shares of RM1.00 each and its issued and paid-up share capital is RM33,000 divided into 33,000 ordinary shares of RM1.00 each. Its principal business is a funeral service provider and undertaker.
2.3 INFORMATION ON TPSB
TPSB is a private limited company incorporated in Malaysia on 10 April 2007 with a current authorised share capital of RM100,000 divided into 100,000 ordinary shares of RM1.00 each and issue paid-up share capital of RM100 divided into 100 ordinary shares of RM1.00 each. Currently, TPSB is owned by LKK (99%) and Ong Pei Yun (1%).
TPSB is incorporated with its core business as funeral service provider and undertaker. Companies Commission Malaysia has on 8 August 2007 approved its name change to Eight Eleven Services Sdn. Bhd. which is currently pending the submission of the relevant documents by TPSB to effect the name change.
2.4.1 PURCHASE CONSIDERATION FOR THE ACQUISITION
|(a) Upon execution of the SPA and fulfilment of all conditions precedent|
|(b) Within 4 months after the close of accounts of the first year of operation of TPSB (of which the accounting date shall be determined by the date for submission to the relevant authority*)|
|(c) 3 installments of RM382,500 each, within 1 year after each preceding date of payment *|
* The payment of each instalment is subject to TPSB achieving a profit after taxation ("PAT") of RM750,000.00 per year for the first 4 years of operation commencing from 1st September 2007. Any shortfall of PAT during that period will entitle NVCP to reduce or defer the instalment payment to the extent of 51% of such shortfall.
2.4.3 CONDITIONS PRECEDENT
The SPA is conditional upon happening of the following events unless otherwise waived by NVCP:-
(a) the transfer of ownership of a prescribed list of assets free from all encumbrances from 811 to TPSB;
(b) the assignment of the tenancy of premises at No. 139, Jalan Kelang Lama, Bt 3 ½, Jalan Kelang Lama, 58100 Kuala Lumpur in favour of TPSB or a grant of a tenancy of the same for three (3) years upon terms no less favourable than those currently enjoyed by the present tenant; and
(c ) the appointment of staff servants and agents by TPSB upon terms no more favourable than those staff servants and agents currently employed by 811.
2.4.4 SHAREHOLDERS’ ADVANCES
Simultaneously upon execution of the SPA, NVCP and LKK shall make an advance to TPSB in the sum proportionate to its equity interest, aggregating a total sum of RM880,000 (Ringgit Malaysia Eight Hundred and Eighty Thousand Only) free of interest to enable TPSB to complete its acquisition of the prescribed assets from 811.
The Acquisition represents an opportunity for NV Multi to further increase its market share in the bereavement care business.
The Purchase Consideration and Shareholder’s Advance shall be funded by internally generated funds.
The Acquisition will not have any material financial effect on the share capital, earnings, net assets and gearings for the current financial year ending 31 December 2007. However, it is expected to contribute positively to future earnings of the NV Multi Group.
The Acquisition will not have any effect on the shareholdings of NV Multi’s substantial shareholders, as the Acquisition is satisfied entirely in cash.
Like all business ventures, the Acquisition is subject to but not limited to the normal inherent business risk faced by the local bereavement care industry.
The Acquisition is not subject to any approvals of the shareholders of NV Multi and any relevant government authorities.
None of the Directors' and/or substantial shareholders of NV Multi or persons connected with them has any interest whether, direct or indirect, in the Acquisition.
The Board of Directors of NV Multi is of the opinion that the Acquisition is in the best interest of the Group.
To the best knowledge of the Board of Directors of NV Multi, the Acquisition does not depart from the SC Guidelines.
12. DOCUMENTS AVAILABLE FOR INSPECTION
The SPA is available for inspection at the Registered Office of NV Multi at Level 3A, Wisma NV Multi, No. 1, Jalan 1/116A, Off Jalan Sungai Besi, 57100 Kuala Lumpur during normal office hours from Monday to Friday (except public holidays) for a period of fourteenth (14) days from the date of this announcement.
|Company Name||NV MULTI CORPORATION BERHAD|
|Date Announced||29 Aug 2007|