Binasat to venture into solar PV segment via RM18.3 mil acquisition
23 Jun 2021
Binasat Communications Bhd is venturing into the solar photovoltaic (PV) segment via the acquisition of a 51% stake in Borderless Connection Sdn Bhd (BCSB) for RM18.36 million.
BCSB is involved in the engineering, procurement, construction and commissioning of solar PV facilities.
Binasat said RM5.36 million of the total consideration will be in cash, while the remaining RM13 million will be satisfied via the issuance of 37.14 million new shares at an issue price of 35 sen apiece.
The cash position of the consideration will be funded via internally-generated funds, the satellite, mobile and fibre optic network support services provider said in a filing with Bursa Malaysia.
Binasat said the acquisition comes with a profit after tax guarantee of at least RM4 million per year for the financial years ending Feb 28, 2022 and 2023.
“Through the proposed acquisition, the group will diversify its business to include provision of utilities infrastructure services including transmission and distribution network utility services as well as EPCC of solar PV facilities.
“The board believes that BCSB’s business will provide the group with an additional stream of income and diversify its earnings base,” the group said.
It added that the venture is expected to contribute 2% or more of its net profits and/or the diversion of 25% or more of its net assets in the future, and therefore proposes to seek its shareholders’ approval for the venture.
Binasat’s share price rose 0.5 sen or 1.5% to close at 35 sen, giving it a market capitalisation of RM100.25 million.
Source: The Edge Markets