PRG obtains shareholders’ approval to purchase two teak tree plantations worth RM89.2 million

KUALA LUMPUR, Oct 8 -- Property and construction group, PRG Holdings Bhd has secured shareholders’ approval in an extraordinary general meeting today to acquire two teak tree plantations worth RM89.2 million by PRG Agro Sdn Bhd, a wholly-owned subsidiary of the Group.

The first land parcel in Jajahan Gua Musang, Kelantan, measuring 137 ha, is an agriculture land with a 50-year leasehold period expiring on  June 21, 2053, and the 227.79-hectare second land parcel in Jajahan Kecil Lojing, Kelantan also has a 50-year leasehold and will expire on  August 7, 2066.

The acquisition from Alifya Forestry Sdn Bhd, expected to be completed by end December 2019,  is aimed at diversifying and strengthening revenue base, PRG said in a statement here, today.

“PRG Group’s financial performance has been volatile due to the sales decline of its elastic textile and webbings products as well as the slowdown in the Malaysian property development and construction industries.

“(Hence), the board is of the view that the proposed acquisition represents an opportunity for PRG Group to expand its revenue and profitability through the harvesting/logging of the teak trees already planted within the lands,”  it said.

The acquisition will be satisfied via a combination of cash consideration of RM59.2 million and the issuance of 40.29 million consideration shares at an issue price of RM0.7445 each amounting to RM30 million.

-- BERNAMA