KUALA LUMPUR (June 29): Ajiya Bhd (KL:AJIYA) said on Monday that it intends to deploy 98% of the RM44.31 million it received from the sale of its stake in Tanco Holdings Bhd (KL:TANCO) into quoted shares.
In a Bursa Malaysia filing, the building materials manufacturer said the remainder 2% of the proceeds have been set aside for administrative expenses.
Ajiya had earlier said that proceeds from the stake sale were earmarked for working capital requirements. But with Monday's announcement, the company is set to invest an estimated RM43.42 million in quoted shares, and use about RM890,000 for administrative purposes.
The company said it targets to fully utilise the proceeds within six months.
Ajiya disposed of the stake in Tanco, comprising 49.95 million shares, through off-market transactions between April 29 and June 24 at an average price of 88.7 sen apiece, generating a gain of RM14.3 million over their original cost of nearly RM30 million. The disposal reduced its stake in Tanco to 0.76% from 1.59%.
On June 3, Tanco shares went into a steep and sustained decline and it subsequently hit limit-down on multiple consecutive trading sessions. Since then, the developer has lost about RM10 billion in market value.
On Monday, the stock closed down one sen or 7.4% at 14.5 sen, giving the company a market capitalisation of RM889.4 million.
Ajiya’s shares, meanwhile, closed up four sen or 3.9% at RM1.07, valuing the company at RM651.8 million.