Boustead Holdings Berhad ("Boustead Holdings" Or The "Company") Proposed Establishment Of An Islamic Plantation Real Estate Investment Trust To Be Known As "Al-Hadharah Boustead Reit" Involving The Proposed Disposal Of Plantation Assets To Al-Hadharah Boustead Reit And The Proposed Leaseback Of The Said Plantation Assets ("Proposed Establishment Of Al-Hadharah Boustead Reit")
1. INTRODUCTION
We refer to the previous announcement dated 11 September 2006.
As announced, the proposed disposal of certain subsidiaries of Boustead Holdings involves the disposal of nine (9) oil palm estates and two (2) palm oil mills ("Plantation Assets"), for an aggregate sale consideration of RM500.0 million ("Proposed Disposals"). The aggregate sale consideration was proposed to be satisfied by the issuance of 270 million new units by Al-Hadharah Boustead REIT and RM230 million in cash.
2. DETAILS OF REVISED PROPOSED DISPOSALS
After further deliberation by the Manager and Boustead Holdings, it is proposed that one of the Plantation Assets, namely Bukit Limau Estate which is owned by Boustead Pelita Tinjar Sdn Bhd, a 60% owned subsdiary of Boustead Holdings shall be excluded from the Proposed Disposals.
Accordingly, the aggregate sale consideration for the Proposed Disposals will be reduced from RM500.0 million to RM471.9 million as follows:
The revised aggregate sale consideration of RM471.9 million shall be satisfied as follows:
Save as disclosed above, all the other terms and conditions of the Proposed Disposals shall remain unchanged.
3. UTILISATION OF SALE PROCEEDS
The gross cash proceeds arising from the revised Proposed Disposals amounting to RM219.9 million, of which RM135.744 million is attributable to Boustead Properties Berhad, shall be utilised as follows:-
4. FINANCIAL EFFECTS
The consequential effects of the revised Proposed Disposals on the earnings, Net Assets ("NA") and gearing of the Company/Group are as follows:-
4.1 Earnings
The Proposed Disposals are expected to result in a net gain on disposals to the Boustead Holdings Group of approximately RM193.814 million for the FYE 31 December 2006 (assuming that the Proposed Disposals are completed by 31 December 2006), of which RM74.607 million is attributable from Boustead Holdings' 56.04% interest in Boustead Properties' net gain on disposal.
Accordingly, earnings per share of the Group is also expected to improve by 32.40 sen (computed based on the issued and paid-up share capital of the Company of RM299,134,994.50 comprising 598,269,989 ordinary shares of RM0.50 each). The proceeds arising from the Proposed Disposals which would be used for repayment of the borrowings is also expected to result in interest savings to Boustead Holdings Group of approximately RM9.6 million per annum, of which RM4.8 million is attributable to Boustead Properties.
4.2 NA and Gearing
The proforma effects of the revised Proposed Disposals on the consolidated NA and gearing of the Group as at 31 December 2005 based on the latest audited consolidated financial statements of the Company for the financial year ended 31 December 2005 are set out in Table 1 below.
Table 1
Notes:-
Proforma I - After the proposed disposal of Plantation Assets by Boustead HJS and Boustead Plantations only.
Proforma II - After Proforma I and including the proposed disposal of Plantation Assets by Boustead Properties.
* Net assets per share is computed based on net assets attributable to ordinary shareholders divided by the total number of ordinary shares in issue.
For and on behalf of the Board of Directors
BOUSTEAD HOLDINGS BERHAD
MALAYSIAN INTERNATIONAL MERCHANT BANKERS BERHAD
