Alcom plans to diversify into property development, transfer listing status to newco
PETALING JAYA: Aluminium Company of Malaysia Bhd (Alcom) is planning to diversify into property development with a RM500 million gross development value industrial park venture, and transfer its listing status to a new holding company in an effort to form separate identifiable business streams comprising aluminium product manufacturing and property development segments.
In a filing with Bursa Malaysia the group, which is currently only in manufacturing and trading of aluminium sheet and foil products, outlined plans for its unit EM Hub Sdn Bhd to acquire 9.4 acre vacant industrial land in Sungai Buloh, Selangor from a unit of Paramount Corp Bhd for RM92 million, to be developed into a gated and guarded industrial park. The purchase will be funded through internally generated funds and bank borrowings.
In its filing the group said it remains focused on improving the performance of the existing business by enhancing its product offerings and expanding its market share, and decided to diversify its earning base to include property development and reduce the risk of reliance on the existing business.
Alcom plans to form a project management team for its venture, with four key personnel, namely Datuk Lim Chee Khoon, who has 28 years experience in the property development sector; Ang Loo Leong who has extensive experience in contractual matters; Lim Wey Heng the industrial park project manager with 10 years experience in various residential and commercial projects; and Tan Seok Fong the finance manager for the industrial park with 16 years of experience in account and finance. The development and building plans of the industrial park have not been submitted or approved by the relevant authorities, however preliminary gross development cost estimates are expected to be at least RM425 million.
Following the acquisition, the group proposes to call for all existing shareholders of Alcom to exchange their shares for those in the new holding company, which will then takeover the listing status of Alcom. The proposals are subject to the approvals of shareholders and Bursa Securities.
The group’s stock price was down one sen to close at 85 sen with some 114,900 shares changing hands.