KUALA LUMPUR (Sept 15): Solid Automotive Bhd has proposed to sell a 4.05-hectare parcel of land in Johor Bahru for RM48 million, using the proceeds for investment purposes, capital expenditure (capex) and working capital.

In a filing to Bursa Malaysia, the company said that its wholly-owned subsidiary Solid Autotech Sdn Bhd has entered into a sale and purchase agreement (SPA) with Ferrotec Power Semiconductor Malaysia Sdn Bhd in respect of the proposed disposal.

The disposal consideration of RM48 million represents a premium of RM5 million or 11.63% from the market value of RM43 million, it said.

The sale is expected to result in a pro forma gain of RM34.23 million, the company added.

Of the proceeds, it will use RM20.5 million for business or investment opportunities, another RM20.5 million for capex, RM4.2 million for working capital and the remaining RM2.8 million for the proposed disposal’s expenses.

The freehold land comes with two detached factories and other ancillary buildings, it added.

Solid Automotive undertakes the distribution of automotive spare parts and components.

In the financial year ended April 30, 2023 (FY2023), the company’s net profit rose 44.4% to RM9.7 million from RM6.72 million, as revenue rose 16.25% to a record high of RM346.86 million from RM298.36 million earlier, thanks to improved market share from both local and Asean markets.

It paid a dividend of 0.3 sen or RM1.56 million for FY2023.

Shares in Solid Automotive finished unchanged at 19 sen on Friday, valuing the company at RM96.21 million.