The 3 target firms have mixed-development projects underway in Penang, according to Ideal UBI’s filing

By FARA AISYAH / Graphic By TMR

Ideal United Bintang International Bhd (Ideal UBI) has proposed to purchase shares in three property development companies in Penang for RM353.1 million from its controlling shareholder, to be satisfied by issuance of new shares in the company.

In an exchange filing yesterday, Ideal UBI noted it plans to buy the entire equity interest in Modular Platinum Sdn Bhd, Ideal Homes Properties Sdn Bhd and Premium Flame Development Sdn Bhd from current executive chairman and substantial shareholders Tan Sri Ooi Kee Liang and Puan Sri Phor Li Wei, who together now hold 54% of Ideal UBI via ICT Innotech Sdn Bhd.

The three target companies have mixed-development projects underway in Penang, the filing noted.

Ideal UBI also proposed a private placement of up to 393.08 million new ordinary shares, representing up to 30% of the issued shares and the subdivision of every one existing share into two ordinary shares.

Ideal UBI added that the proposed private placement is conditional upon the proposed purchase and is intended to comply with the minimum public spread, as well as to raise fresh funds for the development of project under the three companies.

“The company expects to identify the public investors to subscribe for placement shares prior to the issuance of the consideration shares,” the filing read, adding that the pricing will be set later.

It added that the actual number of placement shares will be determined at a later date, after the completion of the proposed acquisition and obtaining the relevant approvals.

After the completion of the proposed acquisition, the company also proposes to undertake the proposed share split, which entails the sub-division of every one existing Ideal UBI share into two subdivided shares.

Ideal UBI’s current issued share capital is about RM110.47 million comprising 110.47 million shares and after the issuance of the 353.09 million consideration shares to satisfy the purchase consideration, the resultant issued share capital of Ideal UBI upon completion of the proposed share split will be RM463.56 million, comprising 927.11 million subdivided shares.

“The proposed acquisition represents an opportunity for Ideal UBI to bolster its current portfolio of development projects, and enhance its profile as a property developer by participating in more property development projects which are profitable.

“Given the outlook for the property market in Penang, the board is of the opinion the proposed acquisition is the most appropriate means for Ideal UBI to further its venture into the property development industry at this juncture,” the company stated.

It added that the issuance of the consideration shares for the proposed acquisition will also strengthen the company’s financial position with enhanced shareholders’ funds.