KUALA LUMPUR (Oct 10): AWC Bhd has secured Islamic banking facilities of up to RM100 million from AmBank Islamic Bhd. The amount will be used to finance the acquisition of a 49% equity stake in automated waste collection system provider Stream Group Sdn Bhd.

Last month, AWC announced it is buying the remaining 49% stake it does not own in Stream Group, for RM110 million, confirming a report by The Edge.

At the same time, it is taking over the remaining 51% stake that Stream Group does not own in Premium Patents Sdn Bhd, which holds the intellectual property rights of assets required for Stream Group's current business, for RM1.

In the latest bourse filing, the integrated facilities management system provider said RM99 million will be allocated to fund the acquisition and the remaining RM1 million will be utilised for the reducing term takaful to cover the life of a key person of AWC.

Despite the possibility of fluctuation in the bank’s base financing rate and cost of funds, AWC said the facilities are not expected to have any material effect on the group’s earnings per share, gearing and net assets per share for the financial year ending June 30, 2024.

The group's total borrowings stood at RM20.42 million as at June 30, 2023, which comprises RM11.7 million of short-term borrowings and the remaining RM8.72 million is long-term borrowings.

Compared to the previous year, its total borrowings have increased from RM14.82 million as at June 30, 2022.

According to The Edge's earlier report, Stream Group had been a profitable investment for AWC since it bought into the company in 2004, when it was then known as Nexaldes Sdn Bhd.

Stream Group made a net profit of RM23.42 million for the financial year ended Dec 31, 2022 — more than AWC’s reported net profit of RM21.53 million in the period — on revenue of RM81.9 million.

The acquisitions, which require its shareholders' approval, are expected to be completed in the first quarter of 2024.

AWC's share price closed up one sen or 1.79% to 57 sen, giving the group a market capitalisation of RM184 million.

Year-to-date, the stock has gained 24%.

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AWC confirms acquisition of remaining 49% stake in Stream Group for RM110 mil