MY Dealbook: Parkson’s rejig plan rejected; Glomac sells land to PR1MA for $35m; EPF sheds stake in Coastal Contracts

Parkson Holdings website.

Corporate Malaysia saw a mix of deals over the first half of the week. While retail giant Parkson Holdings’ plans to expand is thwarted as shareholders voted against its reorganisation exercise, Glomac made a land disposal to government affordable housing agency PR1MA and EPF sold its stake in Coastal Contracts.

Parkson’s internal reorganisation plans rejected, SG-listed unit not for sale

Parkson Holdings Bhd’s proposed internal reorganisation exercise, involving its Hong Kong-listed unit, has been rejected by the latter’s minority shareholders.

Parkson Holdings announced, in a filing on Bursa Malaysia, that the resolution for Hong Kong unit Parkson Retail Group Ltd (PRG) to purchase the 67.6 per cent stake in its Singapore-listed sister company, Parkson Retail Asia Ltd (Parkson Asia), for S$228.51 million cash was not passed at the extraordinary general meeting on Monday.

The reorganisation, if proceeded with, would have funnelled some MYR641.4 million ($157.2 million) cash from subsidiary, PRG, through to its coffers to be utilised for expansion.

Consequently, Parkson Holdings said it will not proceed with the proposed capital distribution, which hinged on the amount received from the divestment of its Parkson Asia shares to PRG. The group will not be able to carry out expansion plans it had made, including venturing into the shopping mall business.

The proposed reorganisation plan was to have PRG own Parkson Asia, which has 67 stores in Malaysia, Vietnam, Indonesia and Myanmar. Currently, Parkson Holdings holds a 53.1 per cent stake in PRG and a 67.6 per cent in Parkson Asia.  

“Although the acquisition will not proceed, the board remains committed to drive the group’s long-term growth to create value for shareholders. With the group’s strong track record, nationwide store network, and good relationships with suppliers, partners and brands, the group will continue to pursue all of its existing strategies to transform into a leading lifestyle concept retailer,” PRG executive director and chairman Cheng Heng Jem said.

Parkson Asia’s sale was first posited in mid-July as Parkson Holdings said it would be able to raise funds for business expansion, new investment opportunities, and/or working capital.

Glomac to sell land to PR1MA for $34.54m

Glomac Berhad is looking to dispose a piece of freehold land measuring about 16.9ha in Ulu Langat, Selangor, to Perbadanan PR1MA Malaysia (PR1MA) for MYR145.59 million ($34.54 million) cash.

The disposal is expected to result in an estimated net gain of MYR83.6 million or MYR0.12 per share, according to the group’s filing with Bursa Malaysia yesterday. The proceeds are to be utilised for future acquisitions of land bank, and to finance payment of bank borrowings, working capital and land-related expenses of GMSB.

Glomac’s wholly-owned subsidiary Glomac Maju Sdn Bhd (GMSB) entered into a sale and purchase agreement with PR1MA for the disposal last Friday. The property developer said, the agreement would allow GMSB to unlock the potential value of its land bank, generate income and increase opportunities for immediate and/or future acquisitions of more strategic land bank.

The land was bought in 2004, at MYR18.04 million. Its net book value is MYR35.53 million.

EPF ceases to be substantial shareholder in Coastal Contracts

The Employees Provident Fund (EPF) has ceased to be a substantial shareholder in marine services and vessels provider Coastal Contracts Berhadafter disposing of 2.177 million shares in the company on Thursday.

In a filing with Bursa Malaysia on Monday, Coastal Contracts revealed that EPF, which had a 5.378 per cent stake in the company on September 30, is now only left with 26.358 million shares.

According to Bloomberg data cited by The Edge Financial Daily, the offshore support vessel fabricator’s largest shareholder to date is Ivory Asia Sdn Bhd (28.51 per cent), followed by Pang Fong Thau (11.58 per cent).

EPF had been a substantial shareholder on and off. It ceased to be a substantial shareholder in Coastal Contracts on September 18 last year, but upped its stake in April 14.

Also read:

Malaysia’s Parkson divests Singapore unit to Hong Kong subsidiary for $167m

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EPF ups stake in Litrak, becomes major shareholder in property developer UEM Sunrise