COMPLET (5136) Complete Logistic plans dividend with stake sale in three subsidiaries for RM85.6m
KUALA LUMPUR (Aug 13): Complete Logistic Services Bhd is planning to sell 80% of its shareholdings in three wholly-owned companies to SH Cogent Logistics Pte Ltd for RM85.6 million, cash, as the company moves to realise "substantial value" from its investments in its forwarding, haulage and warehousing businesses.
The three are Dolphin Shipping Agency Sdn Bhd (DSA), Guper Integrated Logistics Sdn Bhd (GIL) and Gems Logistics Sdn Bhd (GEMS), and the disposal will result in a gain of RM57.27 million to the group, according to Complete Logistic's Bursa Malaysia filing today.
The disposal includes two pieces of leasehold land in Johor and Selangor, measuring about 14,961 sqm and 10,667 sqm respectively, together with a warehouse each on both the lands.
Of the total proceeds, RM40 million will be used for future investment, RM20.32 million will be used for dividend to shareholders, and RM20.28 million will be used for working capital, with the remaining RM5 million to be used to defray estimated expenses from the proposed disposal.
All three companies are profitable, as of the full year ended March 31, 2019 (FY19). DSA had a profit after tax (PAT) of RM1.1 million, while GIL's and GEMS' PAT stood at RM6.99 million and RM2.11 million, respectively.
Complete Logistics said the sale is expected to contribute positively to its future consolidated earnings for FY20, with recognition of the disposal gain, after taking into consideration, inter-alia, the associated cost of investment and expenses, incidental to the proposed exercises.
The group expects the proposed disposal to be completed by the third quarter of FY20.
Complete Logistics' shares closed half a sen or 0.56% higher at 90 sen today, which valued the company at RM114.3 million.