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22 June 2017 - Construction company Protasco Bhd had seen sophisticated accounting treatments, and abnormal contract arrangements. Latest news is the lost of controlling interest in subsidiary KPS-HCM Sdn Bhd just 7 days after being awarded some RM174.4 million jobs.
According to 15 June 2017 Bursa Malaysia announcement, Protasco Bhd quote "The Company is pleased to announce that its subsidiary, KPS-HCM Sdn. Bhd. has been awarded by Central Spectrum (M) Sdn. Bhd., a subsidiary of Kumpulan Hartanah Selangor Berhad, the proposed infrastructure works for the development of Phase 3C, Lot 74079, Pulau Indah Industrial Park, Pulau Indah, Mukim Klang, Daerah Klang, Selangor (“Works”), for a total contract sum of  approximately RM174.4 million. The Works are to be completed within 18 months commencing from 5 July 2017 to 5 January  2019 and  are expected to contribute positively to the earnings of the Protasco Group for the financial year ending 31 December 2017. "
KPS-HCM Sdn. Bhd. was a 70% subsidiary of Protasco Bhd.
However, on 21 June 2017 Bursa Malaysia announcement, the company further quoted "Protasco Bhd wishes to announce that its wholly-owned subsidiary, HCM Engineering Sdn Bhd (“HCM”) had on 21 June 2017 entered into a Subscription Agreement with Kumpulan Perangsang Selangor Berhad (“KPS”) for the subscription of 1,715,000 ordinary shares by KPS in KPS-HCM Sdn Bhd (“KPS-HCM”) for the total cash consideration of RM1,715,000 (“Subscription”).
The Subscription will result in HCM diluting its shareholdings in KPS-HCM from 70% to 49% and therefore ceased to be an indirect subsidiary of Protasco."
Market was spooked with such strange decisions, where a contract was just awarded was divested in just 7 days later for a considerable low price of RM1,715,000 paid by Kumpulan Perangsang Selangor Berhad ("KPS"). Is Protasco Bhd cash flow in such critical condition, where they need to divest majority of a subsidiary to raise less than RM2 million? 
According to the company announcement, KPS-HCM was initially incorporated as a joint venture to secure and undertake a 7-years contract for state road maintenance awarded by the Selangor State Government. Moving forward, the shareholders of KPS-HCM intend to broaden the scope of its business activities to include general civil engineering works, building construction and maintenance in addition to the construction, maintenance, refurbishment and rehabilitation of roads. Does this mean Protasco is breeding a competitor in the whole process to take away its business?
The Subscription will enable KPS to take majority control and enabling KPS-HCM to become a subsidiary of a state-owned corporation. With the Subscription, it is envisage that KPS-HCM would have strong growth opportunities and business sustainability which would have positive impact on Protasco’s future earnings albeit non- consolidation of KPS-HCM’s result.
In short, the company is divesting the subsidiary for a low price, and (made) no shareholder approval is required.
Despite recent entry of EPF, MD Chong Ket Pen continues to purchase the company shares. Investors in general remain sideline and are looking for clearer signals if there are anymore surprises from Protasco Bhd.
FinNews

http://www.bursamalaysia.com/market/listed-companies/company-announcements/5461765

OTHERS LETTER OF AWARD FOR INFRASTRUCTURE WORKS

PROTASCO BERHAD

Type Announcement
Subject OTHERS
Description
LETTER OF AWARD FOR INFRASTRUCTURE WORKS
The Company (“Protasco”) is pleased to announce that its subsidiary, KPS-HCM Sdn. Bhd. has been awarded by Central Spectrum (M) Sdn. Bhd., a subsidiary of Kumpulan Hartanah Selangor Berhad, the proposed infrastructure works for the development of Phase 3C, Lot 74079, Pulau Indah Industrial Park, Pulau Indah, Mukim Klang, Daerah Klang, Selangor (“Works”), for a total contract sum of  approximately RM174.4 million.  
The Works are to be completed within 18 months commencing from 5 July 2017 to 5 January  2019 and  are expected to contribute positively to the earnings of the Protasco Group for the financial year ending 31 December 2017. 
None of the Directors, major shareholders of Protasco or person connected with them have any interests, direct or indirect, in the award of the Works.




Announcement Info

Company Name PROTASCO BERHAD
Stock Name  PRTASCO
Date Announced 15 Jun 2017
Category General Announcement for PLC
Reference Number GA1-15062017-00055


http://www.bursamalaysia.com/market/listed-companies/company-announcements/5466521

OTHERS SUBSCRIPTION OF ADDITIONAL SHARES IN KPS-HCM SDN BHD BY KUMPULAN PERANGSANG SELANGOR BERHAD

PROTASCO BERHAD

Type Announcement
Subject OTHERS
Description
SUBSCRIPTION OF ADDITIONAL SHARES IN KPS-HCM SDN BHD BY KUMPULAN PERANGSANG SELANGOR BERHAD
Protasco Berhad (“Protasco”) wishes to announce that its wholly-owned subsidiary, HCM Engineering Sdn Bhd (“HCM”) had on 21 June 2017 entered into a Subscription Agreement with Kumpulan Perangsang Selangor Berhad (“KPS”) for the subscription of 1,715,000 ordinary shares by KPS in KPS-HCM Sdn Bhd (“KPS-HCM”) for the total cash consideration of RM1,715,000 (“Subscription”).
The Subscription will result in HCM diluting its shareholdings in KPS-HCM from 70% to 49% and therefore ceased to be an indirect subsidiary of Protasco.
The detailed announcement is attached herewith.


Please refer attachment below.

Attachments



Announcement Info

Company Name PROTASCO BERHAD
Stock Name  PRTASCO
Date Announced 21 Jun 2017
Category General Announcement for PLC
Reference Number GA1-21062017-00012
 


http://klse.i3investor.com/blogs/Crocsandtigers/126305.jsp
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