KUALA LUMPUR (Jan 7): Shares of Kejuruteraan Asastera Bhd (KAB) surged 17% today after it announced its expansion strategy into the solar energy industry.
At 2:50pm, KAB's share price rose 11 sen to RM1.33 with some 2.15 million shares traded, valuing it at RM492.41 million.
In its filings with Bursa Malaysia on Jan 3, KAB said it is expanding into the solar energy industry via the proposed acquisition of a 30% stake comprising 37,500 shares in the enlarged issued share capital of LeveragEdge Sdn Bhd (LSB) for RM2.1 million.
The electrical and mechanical engineering company said it had entered into a heads of agreement with LSB and Loo Chun Keat.
KAB also said LSB provides solar photovoltaic and energy efficiency solutions while Loo is an existing director in LSB.
"The principal terms and conditions outlined in the heads of agreement is subject to the share sales and shareholders agreement or any such other agreements relevant to the proposed investment (definitive agreements) to be entered into between KAB, LSB and Loo," it said.
KAB managing director Datuk Lai Keng Onn said in one of the statements the acquisition is key for KAB as its marks the group's foray into the solar business.
"I believe the solar sector has great potential, supportive favourable government policies and we would like to be part of the sustainable energy ecosystem," Lai said.