Lion Industries takes over China property developer in RM210m debt settlement by Lion Diversified
KUALA LUMPUR (Dec 16): Lion Industries Corp Bhd (LICB) will take over China-based property developer Well Morning Ltd, in a RM210.35 million debt settlement by Lion Diversified Holdings Bhd (LDHB), which is currently in liquidation.
Of the total RM210.35 million outstanding debt, LDHB owes RM26.79 million to Antara Steel Mills Sdn Bhd and RM35.17 million to Lion Waterway Logistics Sdn Bhd, both being subsidiaries of LICB, as well as RM148.39 million to Posim Marketing Sdn Bhd, which is a 74% indirect subsidiary of LICB.
Well Morning, a wholly-owned subsidiary of LDHB, in turn wholly owns Changshu Lion Enterprise Co Ltd, a property developer based in China.
LICB said LDHB was ordered by the High Court of Malaya to be wound up under the provisions of the Companies Act 2016 on Oct 15, 2019.
“In view that LDHB is currently in liquidation process, the liquidator of LDHB is therefore not in a position to repay the outstanding secured amount to each of the secured parties. As such, the proposed settlement would enable the secured parties to recover the outstanding secured amount that has been long outstanding.
“The proposed settlement will result in a net gain after minority interest of RM162 million to the LICB group which will strengthen its financial position,” said the group.
The net gain will translate to a rise of approximately 24 sen per share for its financial year ending June 30, 2021, it said.
LICB rose 4.5 sen or 10.5% to close at 47.5 sen, giving a market capitalisation of RM341.01 million.