KUALA LUMPUR: Ann Joo Resources Bhd
has entered into a conditional sale and purchase agreement (SPA) with Green Esteel Pte Ltd to dispose of its entire equity interest in Ann Joo Steel Bhd (AJSB), after mutually terminating an earlier heads of agreement with Southern Steel Bhd.
In a filing with Bursa Malaysia, Ann Joo said the proposed disposal involves 612.99 million ordinary shares in AJSB, representing a 100% stake, for a cash consideration to be determined based on an agreed pricing formula.
It said the disposal consideration will be derived from the agreed value of the target group’s non-current assets of RM1.005bil, adjusted for current assets and total liabilities as at an independent audit date.
Based on an illustrative calculation as at Dec 31, 2025, the disposal consideration would amount to about RM348.7mil.
“The proposed disposal is in line with the strategy of the group to exit the upstream steel business,” it said, adding that the move would allow the group to refocus its resources on expanding its downstream steel operations, including steel fabrication and engineering-related activities.
Ann Joo noted that AJSB has been loss-making for the past three financial years, recording a net loss of RM218.4mil for the financial year ended Dec 31, 2025, compared with RM280.3mil a year earlier. Revenue declined 22.7% year-on-year to RM1.38bil in FY25.
Upon completion of the proposed disposal, AJSB and its wholly-owned subsidiary, Ann Joo Integrated Steel Sdn Bhd, will cease to be subsidiaries of Ann Joo Resources.
Ann Joo said proceeds from the disposal are expected to be used mainly for repayment of bank borrowings and working capital purposes.
The proposed disposal is expected to be completed in the second half of 2026, subject to shareholders’ approval and other regulatory approvals.
