KUALA LUMPUR (April 19): Ancom Bhd's wholly-owned subsidiary Ancom Crop Care Sdn Bhd (ACC) is acquiring 18,000 shares, or a 90% stake, in Entopest Environmental Services Sdn Bhd, which is in the business of pest control, hygiene, and sanitation services for RM2.07 million in cash.

In its filing to Bursa Malaysia today, it was revealed that ACC has entered into a share sale agreement on April 18, 2016, with Teoh Lee Cheng, Foo See Boon, Ch'ng Sai Hong and Rosli Bulat, who are the vendors of Entopest.

At the same time, two of directors of ACC, namely Lee Cheun Wei and Shamsudin Basri, as well as Anthony Tan Swee Hock, who is the chief operating officer of ACC, are also acquiring the remaining 2,000 ordinary shares, or 10% equity in Entopest from the vendors for RM230,000 in cash.

The acquisition is expected to complete in the fourth quarter of the financial year ending May 31, 2016 (4QFY16). It will not have any material effects on the earnings of the Ancom Group for FY16.

However, it is expected to contribute to the earnings of the Ancom Group from FY17 onwards.

Ancom is an investment holding company with subsidiaries involving in industrial and agricultural chemicals, polymer, media and logistics while ACC is principally involved in the manufacturing and marketing of agricultural chemical products which include various kinds of pesticides and insecticides.

The acquisition is aimed at diversifying the Ancom Group's business to include a business operation which is complimentary to ACC's existing operation. This is expected to have a positive effect on the Ancom Group's future earnings.

Ancom shares were unchanged at 36.5 sen today, for a market capitalisation of RM77.6 million.