KUALA LUMPUR (Aug 12): K-One Technology Bhd (KL:K1) is planning a capital reduction and repayment exercise to facilitate the distribution of a special dividend of up to RM75 million to shareholders following the proposed disposal of its cloud business arm Global Access Points Sdn Bhd (GAP) for RM94 million.
In a bourse filing Wednesday, K-One said the exercise is intended to rationalise its capital structure and balance sheet, including by setting off accumulated losses, and return excess capital to shareholders.
The proposed special distribution of up to nine sen per share — comprising a cash dividend of up to six sen per share or RM47.6 million in total, and a capital repayment of three sen per share or RM27.4 million in total — is based on K-One's 832 million issued shares as at Aug 10.
The payout will only be undertaken after completion of the GAP disposal. K-One also stressed that the nine sen distribution is a preliminary estimate.
Following the capital reduction, K-One's issued share capital will drop to RM77.64 million from RM123.64 million. Of the RM46 million credit arising from the exercise, RM27.41 million will be used for capital repayment, RM12.58 million to eliminate accumulated losses, and RM6.02 million as credit buffer to set off future losses.
K-One's accumulated losses stood at RM8.17 million as at Dec 31, 2025.
Following the disposal and capital reduction, its retained earnings are expected to rise to RM85.38 million. This will subsequently drop to RM10.38 million after the RM75 million payout.
The exercise will not involve any share cancellation or changes to shareholders' stakes.
The group expects its share price to be theoretically adjusted to 5.5 sen, compared to K-One's closing market price of 14.5 sen as at Aug 10.
K-One announced last Tuesday that it was selling its entire equity interest in GAP, an information and communication technology solutions provider, for RM94 million to Tokyo-listed ITOCHU Corp and its Singapore unit.
UOBKH is the adviser for the proposed capital reduction and repayment.
K-One’s shares price closed half a sen or 3.57% higher at 14.5 sen, giving the group a market capitalisation of RM121 million.