KUALA LUMPUR (Feb 6): Pentamaster Corp Bhd’s (KL:PENTA) 63.09%-owned Hong Kong-listed unit Pentamaster International Ltd (PIL) is expected to be delisted on March 19.
The delisting will take place if shareholders approve a corporate exercise in a Feb 28 extraordinary general meeting (EGM), and other requisite conditions are fulfilled, according to PIL’s Hong Kong Stock Exchange (HKSE) filing on Wednesday.
The exercise entails Main Market-listed Pentamaster and partner Puga Holdings Ltd acquiring a 7.1% and 29% stake, respectively, in the HK unit, at 93 Hong Kong cents (53 sen) a share, as well as an issue of a special dividend of seven Hong Kong cents per share to its shareholders.
In other words, PIL’s minority shareholders will get HK$1 per share upon exiting the company. At its completion, Pentamaster will own a 71% stake and Puga with 29%.
According to PIL’s filing, the company’s independent directors deemed the exercise “fair and reasonable”, after taking into account the advice and recommendation of independent financial adviser Quam Capital, and recommended minority shareholders to vote in favour of the exercise.
Pentamaster’s acquisition of the additional 7.1% stake in PIL will cost HK$158.47 million (RM90.31 million). Its existing 63.9% stake or 1.53 billion shares in the HK-listed company entitles it to a payout of HK$107.35 million (RM61.34 million) from the special dividend.
All in all, the exercise will cost the Main Market-listed automated test equipment firm a net HK$51.12 million (RM28.97 million).
Previously, the group said it intends to use internal funds to finance the acquisition. Pentamaster had cash of RM466.73 million and no borrowings as at end-September 2024.
For the nine months ended Sept 30, 2024 (9MFY2024), PIL posted a net profit of RM88.8 million, down 18% from a year earlier, as revenue declined 5.8% to RM492.18 million.
Meanwhile, Pentamaster’s net profit for 9MFY2024 fell 25.4% year-on-year to RM51.05 million, on the back of revenue slipping 5.8% to RM492.34 million.
PIL was listed on the Main Board of the HKSE in January 2018.
Shares in Pentamaster ended 12 sen or 3.36% higher at RM3.69, valuing the group at RM2.63 billion.