KUALA LUMPUR: Construction and property developer Ekovest Bhd is buying a 23.42% stake in PLS Plantations Bhd for RM76.5mil from a company controlled by its executive chairman Tan Sri Lim Kang Hoo.
The purchase price works out to RM1 per PLS share. Shares in PLS, which is involved in management and operation of forest plantation and oil palm plantation in Johor, fell two sen to close at 95 sen on Tuesday.
“The proposed acquisition is being carried out to transform Ekovest into a larger listed conglomerate with a larger portfolio of diversified businesses,” Ekovest said in a filing with Bursa Malaysia today.
PLS group, through its 70%-owned subsidiary, Aramijaya Sdn Bhd, is involved in the management, operation and maintenance of Ladang Hutan Ulu Sedili, a forest plantation project that covers a total area of 35,223 hectares situated within the district of Kota Tinggi and Mersing in Johor.
The company has reported losses for the past three financial years until March 31, 2018.
To improve its financial performance, PLS in October last year, has proposed to diversify into durian plantation and distribution business. the acquisition comes witha profit guarantee.
“Whilst the board had taken note of the current financial performance of PLS Group, the board had also taken into consideration the potential and prospects of PLS,” Ekovest said.
“Further, in line with the company’s long term strategy of expanding and diversifying into other businesses, the company may consider acquiring more PLS shares at an opportune time,” it said.