TM acquires MRCB subsidiary

by **Cals** Thu 28 Nov 2013, 10:19

Business & Markets 2013

Written by Lyana Shohaimay of theedgemalaysia.com

Thursday, 28 November 2013 10:17

KUALA LUMPUR: Telecommunications service provider Telekom Malaysia Bhd (TM) has acquired GTC Global Sdn Bhd, a subsidiary of Malaysian Resources Corp Bhd (MRCB) for RM45 million cash.

In a filing with Bursa Malaysia yesterday, TM said it had entered into a share sale agreement with GTC Global’s holding company, Gapurna Global Solutions Sdn Bhd, which in turn is a wholly-owned subsidiary of MRCB, for the entire equity interest in GTC Global.

TM said the proposed acquisition, which is expected to be completed by the first quarter of 2014, will complement its core competencies and broaden its capabilities in information and communications technology.

It said the move will enable the company “to better serve its range of customers, particularly in the enterprise and government segments”.

MRCB said the proposed disposal would enable it to better utilise and focus its resources, as part of its macro strategy, on its core businesses of property development and specialised infrastructure, concession and environment projects.

MRCB, in its separate filing with Bursa yesterday, said since it completed the acquisition of GTC Global in August this year, GTC Global had submitted various tenders for projects to implement and maintain integrated security surveillance systems.

It said the implementation of successfully tendered projects by GTC Global requires considerable capital expenditure in order to build the necessary infrastructure, and MRCB may have to raise funds for it.

The company said the fundraising may increase its consolidated gearing ratio from the current 2.3 times based on the audited accounts for the financial year ended Dec 3, 2012 (FY12).

For the financial year ended Dec 31, 2012, GTC’s audited net profits after taxation stood at RM3.52 million and audited net assets at RM44.41 million in coming to the purchase price of RM45 million.

This article first appeared in The Edge Financial Daily, on November 28, 2013.