PERWAJA (5146) - Perwaja jumps 50% after China’s Zhiyuan steps in early to restart its plant
May 5, 2015 : 5:16 PM MYT
KUALA LUMPUR (May 5): Practice Note 17 entity Perwaja Holdings Bhd has surged as much as 50% or 8.5 sen to 25.5 sen today after it signed a second memorandum of agreement (MOA) with China-based alloy manufacturer Zhiyuan Investment Group Co Ltd to restart Perwaja’s plant in Kemaman, Terengganu.
On April 30, Perwaja announced that it is expediting its revamp by allowing Zhiyuan to restart its steel factory while waiting for regulators' approval.
Zhiyuan is expected to invest at least RM100 million under the initial. Both companies also signed a lease agreement, under which, Perwaja will lease a portion of the factory land to Zhiyuan.
As at 4.52 pm, Perwaja was trading at 25.5 sen, with 45.48 million shares done. It was also one of the most actively traded counters on the local bourse today.
Its major shareholder, Kinsteel Bhd ( Financial Dashboard), also drew much interest. As at 4.54 pm, Kinsteel (fundamental: 0, valuation: 0.9) was up 25.81% or 4 sen at 19.5 sen, after 53.32 million shares changed hands. It was trading at 20 sen earlier, up 4.5 sen or 29.03%.
The second MOA and lease agreement will enable Zhiyuan to gain access to the Kemaman plant, and to bring in new machinery to modify and upgrade the machinery at the Kemaman plant and to revamp Perwaja Steel Sdn Bhd (PSSB)’s product lines as soon as practicable.
The Kemaman plant has ceased operations since August 2013. PSSB is a wholly-owned subsidiary of loss-making Perwaja, which in turn, is a 31.25%-owned associate of Kinsteel.
Perwaja said the early revamp and restart of the Kemaman plant, pending the procurement of regulators’ approvals, will augur well for the company.
Prior to the second MOA, Perwaja had signed an MOA with Zhiyuan last February.
The first MOA recorded both companies' intention to explore the possibility of Zhiyuan participating in Perwaja's business to rejuvenate the Malaysian firm.
Last Thursday (April 30), Kinsteel and Perwaja shares jumped in active trade ahead of Perwaja's second MOA and lease agreement announcement.
Perwaja climbed to an intraday high of 19 sen, before paring some gains to close 4.5 sen or 36% higher at 17 sen for a market value of RM95.2 million.
Kinsteel rose two sen or 15% to close at 15.5 sen for a market capitalisation of RM162.6 million.
http://www.theedgemarkets.com
May 5, 2015 : 5:16 PM MYT
KUALA LUMPUR (May 5): Practice Note 17 entity Perwaja Holdings Bhd has surged as much as 50% or 8.5 sen to 25.5 sen today after it signed a second memorandum of agreement (MOA) with China-based alloy manufacturer Zhiyuan Investment Group Co Ltd to restart Perwaja’s plant in Kemaman, Terengganu.
On April 30, Perwaja announced that it is expediting its revamp by allowing Zhiyuan to restart its steel factory while waiting for regulators' approval.
Zhiyuan is expected to invest at least RM100 million under the initial. Both companies also signed a lease agreement, under which, Perwaja will lease a portion of the factory land to Zhiyuan.
As at 4.52 pm, Perwaja was trading at 25.5 sen, with 45.48 million shares done. It was also one of the most actively traded counters on the local bourse today.
Its major shareholder, Kinsteel Bhd ( Financial Dashboard), also drew much interest. As at 4.54 pm, Kinsteel (fundamental: 0, valuation: 0.9) was up 25.81% or 4 sen at 19.5 sen, after 53.32 million shares changed hands. It was trading at 20 sen earlier, up 4.5 sen or 29.03%.
The second MOA and lease agreement will enable Zhiyuan to gain access to the Kemaman plant, and to bring in new machinery to modify and upgrade the machinery at the Kemaman plant and to revamp Perwaja Steel Sdn Bhd (PSSB)’s product lines as soon as practicable.
The Kemaman plant has ceased operations since August 2013. PSSB is a wholly-owned subsidiary of loss-making Perwaja, which in turn, is a 31.25%-owned associate of Kinsteel.
Perwaja said the early revamp and restart of the Kemaman plant, pending the procurement of regulators’ approvals, will augur well for the company.
Prior to the second MOA, Perwaja had signed an MOA with Zhiyuan last February.
The first MOA recorded both companies' intention to explore the possibility of Zhiyuan participating in Perwaja's business to rejuvenate the Malaysian firm.
Last Thursday (April 30), Kinsteel and Perwaja shares jumped in active trade ahead of Perwaja's second MOA and lease agreement announcement.
Perwaja climbed to an intraday high of 19 sen, before paring some gains to close 4.5 sen or 36% higher at 17 sen for a market value of RM95.2 million.
Kinsteel rose two sen or 15% to close at 15.5 sen for a market capitalisation of RM162.6 million.
http://www.theedgemarkets.com
