KUALA LUMPUR (March 28): Shareholders of LEAP Market-listed Lim Seong Hai Capital Bhd (LSH Capital) have paved the way for the construction-related products and service provider to transform into a full-fledged construction and construction-related services and solutions provider.
This came after minority shareholders at an extraordinary general meeting (EGM) on Tuesday (March 28) unanimously approved the acquisition of building construction contractor Astana Setia Sdn Bhd and Lim Seong Hai Ventures Sdn Bhd (LSH Ventures), a debt settlement cum share subscription agreement with LSH Ventures, and diversification of its business to include property development activities.
The corporate proposals entail a combined outlay of RM157.64 million, which will be fully funded via the issuance of 350.31 million new LSH Capital shares at 45 sen apiece.
According to its bourse filing, 25 shareholders holding a collective 27.93 million shares and representing 100% of voting shares, voted to approve all four resolutions.
LSH Capital’s substantial and largest shareholder is executive vice chairman Datuk Lim Keng Guan, who owns a 6.87% stake, and another 62.16% stake via family-owned Lim Seong Hai Resources Sdn Bhd (LSH Resources).
Keng Guan and his three siblings — non-executive chairman Tan Sri Lim Keng Cheng, group managing director Lim Pak Lian, and managing director (machinery, hardware and tools division) Lim Keng Hun — each equally own 25% of LSH Resources.
Pak Lian, Keng Hun, and Keng Cheng’s son are directors and shareholders of LSH Ventures, therefore Keng Guan and LSH Resources abstained from voting on the four resolutions in the EGM.
“Upon the completion of the corporate proposals, the group will be in line to further expand its construction capabilities by fully integrating digital technologies to optimise its operations, enhance its range of services and solutions, and deliver exceptional value to its clients,” LSH Capital said in a separate statement.
Through the corporate proposal, the group said it would be able to leverage the construction expertise of Astana Setia to create synergy with increased efficiency, improved innovation, enhanced solutions, and a larger order book, resulting in a stronger and more effective entity that will propel the growth and profitability of the group, moving forward.
Keng Cheng said the group will continue to implement its growth strategy and pursue further opportunities to enhance its RM775 million outstanding construction work order book, in addition to the provision of construction-related services and solutions under the BEST Collaboration Framework, which the group will be entitled to fees based on their client’s construction and property projects value of RM2.8 billion.
“The corporate proposal has also given us the opportunity to undertake development projects with gross development value of RM1.6 billion, which will also benefit other divisions under the group.”
Shares in LSH Capital closed five sen or 7.69% higher at 70 sen on Tuesday, giving the group a market capitalisation of RM249.23 million.