This followed Thursday’s listing of new shares issued to the company under a special issue, Priceworth said in a press statement.
“Priceworth is proud to have gained the confidence of a strategic investor in Tengku Badrul Hisham,” said executive director Richard Koo.
Maha Gayabina now holds 141 million shares in Priceworth’s enlarged share capital.
In total, Priceworth said, 211.8 million shares were issued at 10 sen each. The special issue has raised raise RM21.18mil, of which RM10mil will go towards part payment of the balance deposit for Priceworth’s unit GSR Pte Ltd’s proposed acquisition of Rumpun Capaian Sdn Bhd.
Rumpun Capaian’s 99.99% owned subsidiary Anika Desiran Sdn Bhd (ADSB), which holds a 100-year concession (up to September 2097) to carry out harvesting, forest management and rehabilitation, and industrial tree planting under the principles of sustainable forest management and environmental conservation within 101.161ha in Trus Madi, Sabah, known as Forest Management Unit 5 (FMU5).
Priceworth had allocated up to 30% of its enlarged paid-up capital for the special share issue, with up to 20% for Maha Gayabina.
Aside from Maha Gayabina, the other strategic bumiputra investors are former banker Tan Sri Rashid Hussain and his wife Puan Sri Emilahani Yang Mohd Yatim, who were allocated up to a 10% stake based on Priceworth’s earlier announcement to Bursa Malaysia.
Tengku Badrul said in the press statement: “We are happy to invest for the long term through Priceworth in Sabah’s green heritage. We want to invest in a sustainable forestry project with a long-time horizon. We want to be part of Sabah’s future.
“We will be holding our stake for the long term as we see value. As part of our commitment, we will be writing in to Priceworth to request a seat on the board.”
Priceworth, whose concession has raised concerns among environmentalists, said the tough course taken by Sabah over the last 20 years to implement sustainable forest management practices had created a legacy that would benefit all Sabahans, preserving its natural heritage while managing a precious resource for future generations.
It said through the Sabah Forestry Policy, the Government had identified areas that must be conserved as Protection Forests as well as areas which are suitable to be Production Forests that must be sustainably managed to ensure permit a perpetual supply of forest products for both subsistence and industrial uses.
“Through natural forest management of Production Forests, Sabah can establish the right balance between its cultural and heritage needs and its economic needs,” said Koo.
“This is a game-changer for Sabah’s timber industry which must shed short-term thinking and must commit wholly to long-term objectives which are sustainability and renewability. In the future, the way forward has to be wood products with the necessary certification that come from sustainable forests.”
Priceworth explained that ADSB was required to plant, rehabilitate and harvest forests under the principles of sustainable forest management and environmental conservation for economic, environmental and social purposes as imposed by the terms of the sustainable forest management licence agreement (SFMLA).
“Managing FMU5 properly is a big responsibility for Priceworth, but we are proudly accepting it and will rise to the challenge,” Koo added. “With 81 years remaining on the SFMLA, we have committed to sustainable forest management, and we are prepared for the long haul. With such a long tenure, we can afford to be patient and keep investing in the future.”
Priceworth said it had already established its track record in sustainable forest management practices, and would be producing next year its first Forest Stewardship Council-certified harvest from part of its existing 28,000ha under management.
Last month, the Sabah Forestry Department gave its approval for ADSB, which has appointed Priceworth’s unit Sinora Sdn Bhd as contractor, to start operations in Compartment 57 and Compartment 58 in Trus Madi.
As the contractor, Sinora agrees to buy from ADSB the logs it extracts at RM5 net per cu metre for all sizes, species and grades.
The price excludes the log extraction charges, royalty, premium, cess and any other statutory charges to be borne and paid by Sinora directly to the Sabah Forestry Department for and on behalf of ADSB.
Priceworth shares closed on Thursday at 23 sen, down 1 sen, with 30.72 million shares changing hands.