KUALA LUMPUR: Carimin Petroleum Bhd
’s 90%-owned subsidiary Sri Borneo Energy Sdn Bhd (SBE) has proposed to acquire leasehold land and buildings in Kuching, Sarawak, for RM21.12mil cash.
In a filing with Bursa Malaysia, Carimin said SBE entered into a sale and purchase agreement with Sarwaja Timur Sdn Bhd (in liquidation) for the proposed acquisition.
The 7.246-hectare property in Sejingkat, Kuching comprises a three-storey administrative office, factory building, fabrication shops, a galvanising plant, storage and bundling yards and other facilities.
SBE plans to use the property for the manufacturing, fabrication, assembly and galvanising of metal products, as well as related operational and storage activities, subject to the necessary approvals and title conditions.
“The proposed acquisition would include the reactivation of the galvanizing and metal fabrication business, leveraging on the former plant's track record and customer recognition.
“SBE would then expand into more industry and market segments for future growth,” Carimin said.
It said the purchase price will be funded about 90% through bank borrowings and 10% through internally generated funds.
The property has a 60-year lease expiring in November 2049 and is currently subject to a title condition restricting its use to a dockyard.
The acquisition is conditional upon SBE obtaining written consent from the Sarawak minister responsible for land for the transfer of the property.
Carimin said the acquisition is not expected to have a material immediate impact on its earnings for the financial year ending June 30, 2027, although it is expected to contribute positively to earnings over the longer term once SBE begins operations.
The group's gearing is expected to increase to 0.21 times from 0.12 times, depending on the final funding mix.
The acquisition is expected to be completed within 12 months, subject to the required consent.
