PETALING JAYA: Atta Global Group Bhd is acquiring property company Sungguh Gemilang Development Sdn Bhd for RM12mil to diversify into the property development business.
Atta told Bursa Malaysia in an announcement that wholly owned subsidiary Park Avenue Construction Sdn Bhd (PAC) had entered into a share sale and purchase agreement with Ch’ng Dickeon and Chua Phaik Fang (both Sungguh Gemilang directors and shareholders) for the acquisition.
“The proposed acquisition is a strategic move in view of the company’s proposed diversification into property development and would expect to generate synergistic benefits to the group,” said Atta, a manufacturer of metal products such as steel coils, tubes, strapping and steel furniture.
Atta said Sungguh Gemilang owns 0.71ha freehold land in Butterworth, which it intends to develop into a mixed property project.
“Atta is planning mixed development on the said land. The board of directors of Atta believes that this is an opportunity to enjoy the project’s potential yields when it is launched and successfully implemented.”
The acquisition will make Sungguh Gemilang a wholly owned subsidiary of PAC.
Based on Sungguh Gemilang’s management account for the financial year ended Dec 31, 2017 (FY17), the company has a net loss and net liabilities of RM269,870 and RM446,029 respectively.
“The acquisition is not expected to have any material effect on the earnings per share of the Atta group, net assets per share, gearing, share capital and substantial shareholders’ shareholdings of Atta for FY18 ending March 31,” said Atta.