M&A to list on Bursa with reverse takeover of SYF
KUALA LUMPUR: Insas Bhd has proposed to inject its wholly-owned subsidiary M & A Securities Sdn Bhd into SYF Resources Bhd.
Under the proposal, Insas will dispose of its 100% equity stake in M&A to SYF, comprising 100 million ordinary shares and 60 million redeemable convertible preference shares, in exchange for 1.58 billion new SYF shares, valuing M&A at RM222mil.
In a statement Wednesday, Insas said the proposed M&A disposal was essentially a backdoor listing of M&A via SYF, which would enable Insas to create a separate listing platform for M&A on the Main Market of Bursa Securities.
“The listing status of M&A Group on the Main Market of Bursa Securities will enable it to raise its future equity and debt funding requirement through the capital market independently from Insas Group, expand its customer base, as well as retain and attract new employees from the financial services industry,” it said.
Upon completion of the proposed M&A disposal, SYF will see a name change to M&A Capital Bhd, which will be principally involved in the business of financial services via M&A Group.
Insas will emerge as the new controlling shareholder of SYF with 75.9% stake, from 8.8% currently. It will also seek an exemption from undertaking a mandatory offer for the remaining shares in the company.
As part of the overall proposal to transform SYF into a financial services group, SYF has proposed to dispose of its rubberwood furniture manufacturing arm, and two parcels of lands in Cheras for a total consideration of RM71.2mil cash.
Subsequently, SYF intends to undertake a special dividend cum capital repayment exercise of RM102.4mil or 18 sen per share to reward its shareholders on an entitlement date to be determined later.
It said the special dividend of seven sen and capital repayment of 11 sen per SYF share would be funded via proceeds from the proposed SYF disposals, with the remaining from existing cash in SYF.
Concurrently, SYF also proposed a one-for-two rights issue of its shares at 14 sen apiece to raise approximately RM39.8mil; as well as a restricted issue of approximately 10% of its enlarged share capital after the proposed acquisition of M&A, also at 14 sen per share, to raise RM30.2mil.
The application for the proposals is expected to be submitted to the relevant authorities by end December 2021.
Subject to approvals from relevant parties including Securities Commission, Bursa Securities as well as shareholders of Insas and SYF, the proposals are expected to be completed in the second half of 2022.