Malaysia-based Lion Industries Corp Bhd is looking to sell its entire 50 per cent stake in Singapore-based Angkasa Amsteel Pte Ltd to a South Korean steel manufacturer for S$26.65 million ($19.6 million), it said in a filing with Bursa Malaysia on Monday.
Lion Industries has signed a conditional sale and purchase agreement with Daehan Steel Co Ltd for the proposed disposal, which is expected to be completed by the first quarter of this year, subject to shareholders’ approval.
According to the stock filing, Lion Industries purchased the 50 per cent stake in 2011 and 2012 for RM38.05 million ($9.2 million) in total. The remaining 50 per cent is held by LTC Corp Ltd.
Angkasa Amsteel is involved in the business of steel trading and fabrication, and the trading of other building materials. The company reported a net profit of S$4.59 million ($3.4 million) in the financial year ended June 30, 2018.
Proceeds of the disposal will be used for Lion Industries’ expansion into the flat steel business through acquisitions, which will require about RM636 million ($154.5 million).
Last July, it proposed to acquire flat steel producer Megasteel and its assets, which has a production capacity of up to 3.2 million tonnes per annum of hot rolled coils and up to 700,000 tonnes per annum of cold rolled coils, for $133 million.