Sarawak Consolidated Industries Completes RM113 Mln Subsidiary Disposal
KUALA LUMPUR, May 22 (Bernama) -- Sarawak Consolidated Industries Bhd (SCIB) has completed the disposal of its subsidiary SCIB Concrete Manufacturing Sdn Bhd (SCM) for RM113 million.
In a statement today, the construction and engineering firm said the disposal was a landmark transaction that sharpens the company’s focus on its construction and engineering, procurement, construction and commissioning (EPCC) segment, while prompting a reassessment of its capital-raising plans.
“This enables SCIB to unlock value from its manufacturing business and refocus its resources on its remaining construction and EPCC activities.
“With the completion of the disposal, SCM will cease to be a subsidiary of the company. As a result, SCIB’s operating structure and funding requirements will be reassessed to reflect the group’s post-disposal business direction,” it said.
In line with this development, SCIB said it will not proceed with the proposed rights issue with warrants based on the current scheme.
“The company noted that a substantial portion of the proceeds from the earlier proposed rights issue had been earmarked for the construction of factory facilities and the purchase of machinery in relation to SCM’s manufacturing business.
“Following the completion of the disposal, this intended utilisation is no longer relevant to the group’s revised operating structure,” it said.
Executive chairman Datuk Chong Loong Men said the completion of the SCM disposal is an important milestone for SCIB as it allows the company to conclude a major component of its corporate realignment exercise.
“This exercise allows us to unlock significant value from our manufacturing business and landbank, while strengthening our financial position to pursue larger and more sustainable opportunities in the construction and EPCC space.
“With SCM no longer forming part of the company moving forward, it is only prudent that we reassess our funding requirements and capital plans based on the company’s revised business structure,” he said.
Moving forward, the company said it may consider a revised rights issue with warrants scheme and submit a fresh application to Bursa Malaysia at a later date, subject to further assessment of the group’s funding requirements.
“Should a revised scheme be pursued, SCIB will seek the necessary shareholders’ approval in accordance with regulatory requirements,” it said.
-- BERNAMA