KUALA LUMPUR: MQ Technology Bhd
is seeking shareholder approval to diversify into gaming-related businesses following an agreement to offer the same for casino operations in Star Vegas Resort & Club in Poipet, Cambodia.
At present, loss-making MQ is a manufacturer of moulds, tools, dies, jigs, fixtures and car spare parts, and expects the diversification to its income stream to aid in a financial turnaround.
"The Group's marketing services for gaming related businesses may potentially contribute to 25% or more of the net profits of MQ Group or cause a diversion of 25% or more of its net assets moving forward," it said in a filing with Bursa Malaysia.
The marketing agreement was made with Vivo Tower, a casino marketing agency, which owns the licence to occupy and operate the casino in the resort owned by Donaco Holdings (HK) Pte Ltd.
According to the terms of the marketing agreement, Vivo Tower will pay MQ half of the profits generated from the casino.
The contract will run for a period of five years from July 1, 2017, with an automatic extension should Vivo Tower receive an extension to its lease of the casino.
In the same filing, MQ also announced that it had entered into subscription agreements for the proposed private placement of 82.85 million shares, or 20% of the total issued shares in the company, at five sen a share.
The proceeds of RM4.15mil will go towards the implementation of the marketing agreement with Vivo Tower.