Solarvest to buy 30% stake in electrical works outfit for RM15 mil cash
27 Jan 2025, 09:15 pm
main news image

KUALA LUMPUR (Jan 27): Solarvest Holdings Bhd (KL:SLVEST), which builds solar farms for clients and also owns stakes in solar farms, is acquiring a 30% stake in Kee Ming Electrical Sdn Bhd for RM15.3 million cash.

The acquisition is part of efforts to maintain its market leader position in solar engineering, procurement, construction and commissioning segment (EPCC), Solarvest said in a filing.

The acquisition values Kee Ming at RM51 million, which is 8.4 times its historical earnings, based on a net profit of RM6.05 million in the financial year ended March 31, 2024 (FY2024), on revenue of RM39.06 million.

Among Kee Ming’s ongoing projects include RM10.09 million subcontractor electrical works for a landed strata housing for a unit of Gamuda Bhd (KL:GAMUDA), and a RM76.5 million warehouse project in Penang, also as a subcontractor.

Kee Ming has also undertaken electrical installation, air conditioning system, automotive factory construction, and sewerage treatment plant and pipeline works, all in Perak, the filing showed.  

Solarvest is buying out Liew Kar Wai’s 10% stake, and getting the other 20% stake from Liew Kar Hoe, who will retain the remaining 70% stake in Kee Ming Electrical.

Kar Hoe has provided net profit guarantees for FY2025 (RM6 million), FY2026 (RM7 million) and FY2027 (RM7 million), Solarvest’s filing showed. The target company had retained earnings of RM11.97 million at end-March 2024, the filing added.

Based on Kee Ming’s FY2024 earnings and Solarvest’s stake from the proposed stake buy, the acquisition will add 9.23% to Solarvest’s bottom line in the year under review.

At end-September, Solarvest had cash of RM54.52 million, against borrowings of RM179 million. Its net gearing stood at 0.4 times.

Shares of Solarvest slipped three sen or 1.74% to close at RM1.69 on Monday, giving it a market capitalisation of RM1.22 billion.

Print
Text Size
Share