Perak Corp Bhd’s (PCB) major shareholders have asked the company to undertake a selective capital reduction (SCR) and repayment exercise totalling RM183 million or RM3.90 per share.
The company told the exchange that the request came from Perbadanan Kemajuan Negeri Perak (PKNP), which holds 52.27% of PCB’s shares, as well as from Fast Continent Sdn Bhd, Cherry Blossom Sdn Bhd and Perak Equity Sdn Bhd which collectively hold 0.63% of PCB’s shares (all parties collectively referred to as the nonentitled shareholders).
“The proposed diversification of PCB group will give rise to a different risk and return profile compared to its existing property development and port operations business.
“Accordingly, it is expected that the PCB group will face uncertainties with regard to its financial performance and cashflow position in the future and this may have an impact on its ability to pay dividends and the market price of PCB shares going forward,” said PKNP when rationalising its decision.
PNKP proposed the total capital repayment be funded through internal funds and/ or financing facilities and that the other non-entitled shareholders would waive their entitlement to the capital repayment.
PKNP said PCB will then be internally reorganised and the proposed SCR will provide greater flexibility for the PCB group to implement the proposed internal reorganisation without adversely affecting its public shareholders.
Upon completion of the SCR, the non-entitled shareholders will collectively hold the entire issued and paid-up capital of PCB and PKNP said that PCB will then be delisted from the exchange.
The proposed SCR is subject to relevant approvals from shareholders and authorities. The acceptance period has been set to Jan 20, 2014.