KUALA LUMPUR (Oct 2): A unit of troubled builder TXCD Bhd (KL:TXCD) has secured a RM110 million subcontract from Vestland Resources Sdn Bhd to undertake structural works for a 62-storey Sovo commercial development in Section 44, Kuala Lumpur.
The contract value is about 1.8 times TXCD’s market capitalisation of RM62.3 million as at Friday’s close.
In a bourse filing, TXCD said its indirect wholly-owned subsidiary Ageson Kensetsu Sdn Bhd had on Friday accepted the letter of award from Vestland Resources, a wholly owned subsidiary of Vestland Bhd (KL:VLB), for the construction for one block of the development.
Work commenced on Friday and is scheduled for completion by Dec 31, 2028.
The Practice Note 17 (PN17) company had in August proposed a capital reduction of up to RM281.5 million, the disposal of its non-core subsidiaries and a RM22 million private placement as part of its revised regularisation plan.
The capital reduction will be used to offset the group’s accumulated losses, while the disposal of non-core subsidiaries will leave Ageson Kensetsu as its sole subsidiary, allowing the group to focus on its construction business. The RM22 million raised via public placemnet would be mainly for working capital.
TXCD revised its regularisation plan following regulatory feedback. The original plan, announced on March 26, proposed transferring its Main Market listing to newly incorporated RCV Bhd, with shareholders exchanging their TXCD shares and irredeemable convertible preference shares for RCV securities on a one-for-one basis.
TXCD shares closed half a sen lower or 2.44% at 20 sen on Friday.