KUALA LUMPUR (Dec 24): MMAG Holdings Bhd (KL:MMAG), which is involved in the sales of digital devices and logistic services, said on Tuesday it has acquired a Boeing B737-400SF aircraft from Japan-based JPA No 161 Co Ltd for US$4.61 million (RM20.76 million) cash.
The ACE Market-listed firm said its cargo unit MJets Air Sdn Bhd entered into an instalment sale agreement with JPA to purchase and take delivery of the converted freighter, according to its filing.
JPA is a wholly owned subsidiary of JP Lease Products & Services Co Ltd (JLPS), one of the largest independent arrangers of tax leases in the Japanese market.
This acquisition increases the group's fleet size to seven aircraft, from the current six leased aircraft.
“With a target fleet of 13 aircraft by the end of 2025, this expansion addresses the overwhelming demand for air cargo services, which has outpaced our current capacity,” MJets chairman Woo Kam Weng said in a statement.
“Due to limited aircraft availability, we have been unable to accept new bookings or charters, making this acquisition critical for meeting growing customer demands, enhancing service reliability, and delivering greater value to our stakeholders,” Woo said.
The total payment will be made in three tranches, with an initial payment of US$750,000 upon signing of the agreement, instalment payments totalling US$3.11 million over 23 months from the delivery date, and a final payment of US$750,000 on the contractual expiry date.
MMAG said the payment will be funded via a combination of internally generated funds and proceeds from the group’s convertible securities exercise. As at end-September, MMAG’s cash stood at RM66.41 million, while its borrowings totalled RM349.6 million.
“Barring any unforeseen circumstances, the agreement is expected to be completed in fourth quarter of the year 2026,” the filing said.
MMAG just in November was granted a waiver by Bursa Securities from being classified as an affected listed company under Guidance Note 3 (GN3). The company fell into GN3 after its shareholders equity fell below 50% of issued share capital in the year ended March 31, 2023 (FY2023).
At the time of writing, shares of MMAG were traded unchanged at 41.5 sen, valuing the group at RM947.09 million. The counter has surged over 300% year-to-date.