KUALA LUMPUR (July 14): Ramssol Group Bhd (KL:RAMSSOL) is disposing of a 40% stake in its wholly-owned subsidiary Rider Gate Sdn Bhd to NASDAQ-listed SAGTEC Global Ltd for RM25 million as part of a partnership to accelerate the growth of its AutoTech platform while unlocking capital for the group.

In a filing with Bursa Malaysia on Monday, Ramssol said the stake sale will be satisfied via the issuance of new SAGTEC shares, subject to approval by the US Securities and Exchange Commission.

Ramssol said the partial stake sale allows it to tap SAGTEC’s capital and software development capabilities to speed up Rider Gate’s commercialisation while enabling the group to redeploy resources to more immediate, earnings-accretive operations.

“This marks a significant step forward in our ambition to scale Rider Gate into a leading platform within the region, backed by the right resources and partners,” Ramssol added in a separate statement.

As part of the agreement, Ramssol has provided SAGTEC with a profit guarantee of at least US$1 million (approximately RM4.25 million) in Rider Gate’s first full financial year after the completion of the transaction.

Rider Gate, which launched in January 2025, provides a digital ecosystem for trading used motorcycles — including services such as financing, insurance, inspection, accessories, and repair.

The platform has signed up more than 25,000 users and over 300 motorcycle dealers, with a target to onboard 1,000 outlets in Peninsular Malaysia within its first year.

The RM25 million consideration — equivalent to US$5.8 million — implies a valuation of RM62.5 million for Rider Gate and will be settled through SAGTEC shares.

SAGTEC, a company specialising in point-of-sale systems, software development, and data management services, has also committed to ensuring that the value of the consideration shares remains at or above US$5.8 million for six months after the lock-up period. Should the shares fall below this value, SAGTEC will compensate Ramssol in cash for any shortfall.

Ramssol expects to record a gain of approximately RM25.14 million from the disposal.

Proceeds from the disposal have been allocated to be used for the repayment of borrowings, the procurement of electric motorcycles (EV bikes), and the launch of a new business vertical focused on EV bike leasing.

The transaction, which is not subject to shareholder approval, is expected to be completed by the third quarter of 2025.

At Monday's market close, Ramssol’s share price was down one sen or 1.12% at 88.5 sen, giving the group a market capitalisation of RM332.4 million.