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Thursday, September 12, 2013

Hong Leong Industries selling Hume stake, ICPS to Narra for RM348m (Star)

Hong Leong Industries Bhd (HLI) is selling its 100% stake in Hume Industries (Malaysia) Sdn Bhd for RM48mil and preference shares in Hume Cement Sdn Bhd for RM300mil to Narra Industries Bhd.

The corporate exercise of both companies, which are under the Hong Leong group, would see the disposals of the 300 million Hume Industries shares and entire 175,000,000 six-year 2% non-cumulative irredeemable convertible preference shares of RM1 each in Hume Cement, in exchange for new Narra Industries shares.

“The proposed disposals will allow HLI to realise its investments in the Hume Cement ICPS and the concrete business division in a manner favourable to the shareholders of Hong Leong Industries,” said HLI on Thursday.

HLI said the Hume Cement ICPS currently held by HLI is only convertible into new ordinary shares in HCement after March 2017.

“The proposed disposal of Hume Cement ICPS will accelerate the participation of HLI’s shareholders in Hume Cement,” it said.

Under the corporate exercise, HLI is selling the 30 million Hume Industries shares for RM48 million which will be satisfied by the issuance of 48 million new Narra shares at an issue price of RM1 per share.

As for the ICPS, the sale of the 175 million ICPS in Hume Cement for RM300 million would be satisfied by the issuance of 300 million new Narra shares at RM1 per share.

HLI said upon completion of the proposed disposals, HLI would implement a capital distribution comprising of a proposed reduction of the capital of HLI involving a reduction of share premium reserve.

It would also undertake a capital repayment exercise involving the distribution of 345.03 million Narra shares on the basis of 1,080 Narra shares for every 1,000 ordinary shares of 50 sen each held in HLI.
These shares representing substantially all the consideration shares to be received by HLI pursuant to the proposed disposals.

HLI said through the proposed capital distribution, HLI shareholders will be able to participate directly in two listed companies, that is in HLI via the existing equity held by them and in Narra which will focus on concrete and cement business.

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