KUALA LUMPUR (Nov 15): Berjaya Corp Bhd had disposed of 4.89% stake or 37.8 million shares in Redtone Digital Bhd via a direct business transaction, raising some RM27.59 million or 73 sen per share.
Following the disposal, Berjaya Corp told Bursa Malaysia on Wednesday that the group and its subsidiaries’ shareholdings in Redtone now stands at 42.57% or 329.06 million shares.
Berjaya Corp said the disposal, which took place on Tuesday (Nov 14), was done by its wholly owned subsidiary Juara Sejati Sdn Bhd. It did not disclose the buyer.
The other substantial shareholder of Redtone is the Johor Sultan Ibrahim Sultan Iskandar, with a 17.34% stake.
Interestingly, Redtone’s share price jumped by 10.2% or 7.5 sen on Tuesday to close at 81 sen, with a sudden surge in trading volume to 7.41 million shares, or more than four times its two-month average trading volume of 1.61 million shares.
Redtone operates three business segments, namely telco services comprising data, voice and managed services, to the government and enterprises; the development, operation and maintenance of telco engineering infrastructure under its managed telco network services (MTNS) segment; as well as cloud and internet-of-things services.
The company’s performance has improved significantly in the last three financial years, from achieving a net profit of RM6.76 million in the year ended June 30, 2020 (FY2020) to RM60.84 million in FY2023.
FY2023 saw the group’s performance improve 56.5% from RM38.87 million, despite a slight decline in operating profit, and this was due to an over 300% gain in investment-related income to RM27.21 million, from RM5.47 million in FY2022.
Full-year revenue rose 37.83% to RM217.82 million, from RM158.04 million, as revenue from both the telco and MTNS segments rose.
Berjaya Corp said this disposal enables it to realise part of its investment in Redtone, and cash proceeds raised from the divestment will be utilised to repay borrowings and for its working capital purposes.
Shares of Redtone settled half sen or 0.6% lower at 80.5 sen on Wednesday, valuing the telecommunication services provider at RM629.87 million. The counter has gained 68% this year.