KUALA LUMPUR: KNM Group Bhd
surged 27% in early trade after finalising the sale of its crown jewel, Borsig GmbH, to Japan’s NGK Insulators Ltd for €270 million (about RM1.25bil).
The Practice Note 17 (PN17) company rose 1.5 sen, or 27.27%, to seven sen with 17.88 million shares traded as of 9.48 am. Over the past month, KNM has gained over 16%.
KNM Group announced that its subsidiary, KNM Process Systems Sdn Bhd (KNMPS), has signed a conditional sale, purchase, and transfer agreement (SPA) with NGK Insulators to dispose of its entire equity in Deutsche KNM GmbH.
This is part of KNM’s efforts to regularise its financial position as a PN17 company and pare down its RM1.27bil debt. The sale proceeds would be used to settle borrowings, reducing its total debt to RM69.42mil and improving its gearing ratio from 3.94 times to 0.22 times.
Upon completion of the disposal, Borsig will be part of NGK Group and will benefit from the strong NGK brand.
Following the disposal, KNM Group will concentrate its efforts on its core business in process equipment manufacturing, which currently operates through KNMPS.
