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| POS Malaysia to buy 20% of Transmile, 28 Jul 04 |
POS Malaysia & Services Holdings Bhd (PSH) and subsidiary Pos Malaysia Bhd (PMB) have proposed to subscribe for 40.48 million new ordinary shares of RM1 each in Transmile Group Bhd, representing about 20.3% of its enlarged issued and paid-up capital, for RM253mil.
PSH said in a statement the subscription rate of RM6.25 per share was a discount of 73 sen (or 10.4%) to the weighted average market price of Transmile Group shares over the past five market days to July 26 of RM6.98.
On Bursa Malaysia yesterday, Transmile Group shares closed at RM7.10, up 10 sen.
PSH proposes to subscribe for 15.68 million Transmile Group shares, or 7.9% of the enlarged issued and paid-up capital, for a cash consideration of RM98mil.
The balance 24.8 million shares, or 12.4%, will be subscribed for by PMB, which will satisfy the consideration of RM155mil by transferring to Transmile Group its entire stake of 30 million shares of RM1 each in Transmile Air Services Sdn Bhd (TAS).
PMB's investment of RM48.54mil for the 30% equity interest in TAS was made between July 13, 1994 and August 1, 2001.
Following the transfer, TAS will become a wholly-owned subsidiary of Transmile Group.
TAS was incorporated on Sept 8, 1989 as Pelangi Mahajana Sdn Bhd and assumed its present name on Dec 31, 1993. It is principally engaged in the provision of air transportation and related services and deals in aircraft, aircraft parts and equipment as well.
PSH said the rationale for the proposed subscription was to unlock PMB's investment in the unquoted shares of TAS in return for quoted Transmile Group shares.
Upon completion of the proposed exercise, PSH would have 20.3% in Transmile Group and through it, continue to have indirect interest in TAS.
The proposed subscription is expected to enhance PSH's earnings for the financial year ending Dec 31, in view of the gain of RM65.1mil derived from the disposal by PMB of the 30% equity in TAS.
PSH aims to complete the proposed exercise by the fourth quarter of the year.
Transmile Group operates air charter services for cargo traffic and aircraft leasing based on long-term contract. It also operates various short-term charter services for cargo traffic.
With a proven record in delivering specialised services, it is confident of sustaining most of the major contracts and in expanding its clientele.
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