KUALA LUMPUR: Instacom Group Bhd has made an offer to buy a 35% stake of Neata Aluminium (Malaysia) Sdn Bhd for RM58mil in an all-share deal as it diversifies into aluminium design and fabrication.

Instacom said on Thursday it had signed a conditional share sale agreement with Ooi Eng Kean, Nor Mohd Amin Shaharudin, Ang Li-Hann and Chia Kok Seng to buy their combined 35% stake comprising of 1.40 million shares.

“The purchase consideration for the proposed acquisition is RM58.80mil which will be fully satisfied by the issuance of 309.47 million new 10 sen shares of Instacom at an issue price of 19 sen per Instacom share,” it said. 

It said under the corporate exercise, it would diversify its core business to include aluminium design and fabrication business and civil engineering and construction business.

It also proposed a bonus issue of up to 210.67 million warrants C on the basis of one free warrant for every five existing Instacom shares.

Neata’s core activities are the design and fabrication of aluminium structures while its subsidiary company, Vivocom Enterprise Sdn Bhd is involved in civil engineering and construction.

For the six months ended June 30, 2014, Neata recorded revenue of RM49.18mil, mainly comprising of RM5.81mil and RM43.37mil from its aluminium design and fabrication segment and construction segment respectively. 

Neata recorded profit before tax of RM6.79mil in the six-month period mainly due to the increase in billable revenue for on-going projects for both aluminium design and fabrication segment and construction segment.

It said the vendors guaranteed that Neata Group’s profit after tax would be at least RM34mil for the two financial years ending Dec 31, 2015 and Dec 31, 2016. This translates into an average profit after tax of RM17mil per annum. 

http://www.thestar.com.my/Business/Business-News/2014/10/02/Instacom-buying-35pct-stake-of-Neata-Aluminium/