KUCHING: Shipping firm Hubline Bhd has proposed to acquire a majority stake in an aircraft company for about RM14.2mil.
Hubline entered into a shares sale agreement with vendors of Layang Layang Aerospace Sdn Bhd (Layang Layang) to acquire a 51% equity interest in the aircraft company last Friday.
The vendors are Dayang Majanga @ Mondongi and Johan Poong Abdullah.
Layang Layang Aerospace’s principal activity is aircraft chartering, cargo transportation, aircraft repairing and spare parts’ supplying.
“Hubline intends to secure bank financing up to RM12mil to part finance this transaction,” the company said in a filing with Bursa Malaysia last Friday.
Separately, Hubline had entered into a guarantee agreement with the vendors that the existing and identified businesses of the Layang Layang group would generate a net profit of not less than RM10.5mil, with a minimum of RM3mil for any one year for the financial years ending Dec 31, 2019, 2020 and 2021 or its equivalent 36 months after taking into account the intended change of financial year to Sept 30 to be co-terminus with Hubline’s financial year.
Layang Layang group currently owns a fleet of seven helicopters and four fixed wing aircraft.
The firm charter in a further six helicopters and one aircraft which it manages on a full-time basis, bringing the total number of helicopters and aircraft under management to 13 and five respectively.
“Where there is greater demand for additional helicopters for specific events, they have pre-established networks that allow them to charter additional aircraft from various other helicopter owners,” said Hubline.
The group is involved in the provision of flying doctor service, emergency medical services, search and rescue missions, aerial sightseeing and aerial survey, mapping and photography, helicopter and aircraft training as well as training for both private and commercial pilot licences.
The operation bases where Layang Layang group has hangers are located in Miri, Kuching, Sibu and Kota Kinabalu. The group also has refuelling stations in various smaller towns.
According to Hubline, Layang Layang Aerospace holds an 80% equity interest in Layang Layang Flying Academy Sdn Bhd, whose principal activity is helicopter and airplane pilot training.
“The proposed acquisition of Layang Layang is in line with Hubline’s business expansion plan to increase our revenue base and this business complements our current line of business,” said Hubline, a logistic company currently concentrating in dry bulk shipping activities.
Hubline pointed out that the proposed acquisition of Layang Layang was expected to broaden the group’s revenue into air logistics and other areas of aviation, with the expectation of generating positive earnings for the group.