KUALA LUMPUR (Jan 12): HeveaBoard Bhd has proposed to acquire a leasehold vacant land in Seremban for RM13.46 million through its wholly-owned unit HeveaPac Sdn Bhd.
The acquisition will enable HeveaPac “to progressively expand its production capacities for meeting the current and future growing demand for its products,” HeveaBoard said in a Bursa Malaysia filing.
HeveaPac is principally engaged in manufacturing ready-to-assemble furniture, and the vacant land is located next to its existing manufacturing plants.
The vendor is one of HeveaPac’s executive directors, Yee Kong Yin.
“The related party transaction does not have any effect on the issued and paid-up share capital of HeveaBoard or the shareholdings of its substantial shareholders, and does not have any material effect on the earnings per share, net assets per share and gearing of the group for the financial year ending Dec 31, 2017,” said HeaveaBoard.
It added that the acquisition will be financed by internally generated funds (33%) and bank borrowing (67%).
HeveaBoard’s share price closed unchanged at RM1.54 yesterday, giving it a market capitalisation of RM775.89 million.
This article first appeared in The Edge Financial Daily, on Jan 12, 2017. Subscribe to The Edge Financial Daily here.