Tasco said on Tuesday it had signed a sale and purchase agreement with Chang Kok Fai and Chan Sun Cheong to buy the two million shares in GCT Group for an indicative cash consideration of RM186.08mil.
GCT Group is principally involved in the business of transportation, cold room storage facilities, repackaging and value added facilities.
GCT Group currently operates from its warehousing facilities in Shah Alam with a total storage capacity of approximately 25,600 pallets and have developed into a full-fledged chilled and frozen food transporter. GCT Group is one of the largest cold chain logistics players in Malaysia in terms of storage capacity size.
As for Tasco, it provides logistics services covering air, sea and land transportation. It also provides warehousing services and serves as a one stop logistics centre to handle domestic and international shipments for its customers.
“The business environment which TASCO Group operates in is very competitive. In order to gain new grounds, TASCO Group has to tap into the expertise within the YUSEN network to venture into new areas of opportunity to further enhance its present strong logistics base.
“One such venture is into the niche area of cold chain logistics, which is a natural step forward given TASCO Group’s existing involvement in traditional ambient warehousing as well as the vast experience in the fast-moving consumer goods (FMCG) and retail industries,” it said.
Tasco added GCT Group owns a sizeable fleet of 174 reefer trucks and operates cold room warehouses with a storage capacity of approximately 25,600 pallets.
Tasco added the acquisition would enable it Tasco to enter the cold chain logistics business in a significant way with its ready capabilities to cater its multi-national customers’ needs and also to serve a wide base of industries, namely the food, pharmaceuticals, chemicals, electronics and other segments.
It also said the GCT Group had been profitable in the last three financial years and for FYE 30 November 2015, recorded a revenue of RM67mil and a profit after tax of RM6.8mil.
“Furthermore, the vendors have warranted that the proforma consolidated EBITDA of the GCT Group shall approximate to RM20.8mil for the FYE Nov 30, 2016,” it said.