1.0 INTRODUCTION
The Board of Directors of Country Heights Holdings Berhad ("CHHB" or “the Company") wishes to announce that CHHB had on 12 June 2025 entered into a Shares Sale Agreement (“SSA”) with South Strategy International Sdn. Bhd. (“the Purchaser” or “SSISB”) for the disposal of its entire equity in Versatile Champion Sdn. Bhd. (“VCSB”), a wholly owned subsidiary of CHHB, subject to the terms and conditions as contained in the SSA (“Proposed Disposal”).
2.0 DETAILS OF THE PROPOSED DISPOSAL
2.1 Details of the Proposed Disposal
The Proposed Disposal entails the disposal of the entire equity in VCSB consisting of two (2) ordinary shares of RM1.00 each for a total cash consideration of RM600,000.00.
VCSB [Registration no. 199501025205 (354410-M)] was incorporated in Malaysia on 7 August 1995 with a paid-up capital of RM2.00 comprising of two (2) ordinary shares of RM1.00 each with operations primarily based in South Africa.
It has a parcel of freehold land measuring 526.09m2 with a building at the North West Province of South Africa, which is currently vacant. VCSB is a property trading company. The net book value of the land based on the audited financial statements of VCSB for the financial year ended 31 December 2023 is RM1,022,779.00.
2.2 Information on the Purchaser
SSISB [Registration no. 202401029347 (1575195-X)] was incorporated in Malaysia on 22 July 2024 with a paid-up capital of RM1,000 comprising of 1,000 ordinary shares, and operates from G27, Ground Floor, The Heritage, Jalan SB Dagang, Mines Wellness City, Seri Kembangan, Selangor and is an investment holding company.
Its sole director is Ms. Khoo Bee Sim and shareholders are Ms. Khoo Bee Sim and Mr. Tang Kiah Ming, each holding 500 ordinary shares, representing 50% interest respectively. Mr. Tang Kiah Ming also holds 0.12% equity in CHHB, while the Company Secretary of SSISB, Mr. Chua Hee Boon, who was also a director of VCSB (resigned on 1 April 2025) and CHHB (resigned on 30 May 2025), holds 0.18% equity in CHHB.
2.3 Salient Terms of the SSA
The salient terms of the SSA include, inter alia the following:
(i) Total cash consideration: RM600,000.00
(ii) Deposit: RM60,000.00 payable upon execution of the SSA.
(iii) Balance Payment: RM540,000.00 payable within three (3) days from the Completion Date or a further period of 30 days subject to interest at the rate of 10% per annum calculated on daily rest basis until the date of full settlement. Completion Date is the date within three (3) months from the date of the SSA.
(iv) Deliverables on Completion Date: Original share certificate(s), duly executed Form 105 (Instrument of Transfer), resignation letters from the existing directors of VCSB, and a board resolution of VCSB approving the share transfer and appointment of new director i.e. Ms. Khoo Bee Sim, and CHHB’s board resolution approving the disposal of VCSB.
(v) The shares shall be purchased free from all charges or liens or other encumbrances and with all rights attaching to the shares including all rights to dividends and other distribution declared, made and paid hereafter.
(vi) CHHB waives any or all pre-emption rights whatsoever that CHHB may have in relation to any of the shares of VCSB under VCSB’s Constitution or otherwise.
(vii) Failure to complete the Proposed Disposal by CHHB, SSISB shall be entitled to the refund of the amount paid within 30 days upon the expiry of three (3) months from the date of the SSA.
(viii) Failure to complete the Proposed Disposal by SSISB will entitle CHHB to forfeit the deposit without further communication to SSISB.
3.0 BASIS AND JUSTIFICATION FOR THE PRICE OF THE PROPOSED DISPOSAL
The Disposal Price was arrived at on willing-buyer willing-seller basis, taking into consideration the net asset value based on the latest audited financial statements of VCSB for the financial year ended 31 December 2023 and future prospects of the subsidiary.
4.0 LIABILITIES TO BE ASSUMED
There are no liabilities, contingent liabilities and guarantees to be assumed by CHHB or its subsidiaries (“the Group”) pursuant to the Proposed Disposal.
5.0 ORIGINAL COST AND THE DATE OF INVESTMENT OF CHHB
The original cost and the date of investment of CHHB in respect of the Proposed Disposal is as below:
No. | Date of Investment | No. of Shares | Amount Paid |
1. |
27.12.1996 |
Two (2) |
RM2.00 |
Total | -------------- Two (2) ======== | ---------------- RM2.00 ========= |
6.0 CASH COMPANY OR PRACTICE NOTE 17 COMPANY
The Proposed Disposal is not expected to result in CHHB becoming a cash company or Practice Note 17 company as defined in the Main Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa Securities”).
7.0 RATIONALE AND BENEFITS OF THE PROPOSED DISPOSAL
The Proposed Disposal forms part of CHHB’s strategic move to streamline its business operations and focus on core business areas. The Proposed Disposal will also unlock the value of a non-core asset and improve the liquidity position of the CHHB.
8.0 UTILISATION OF PROCEEDS ARISING FROM THE PROPOSED DISPOSAL
The gross proceeds of RM600,000.00 from the Proposed Disposal will be utilised by CHHB for working capital purposes, including payment to creditors and general corporate and administrative expenses. The utilisation is expected to be completed within six (6) months from the date of receipt of full payment from the Purchaser.
9.0 FINANCIAL EFFECTS OF THE PROPOSED DISPOSAL
The Proposed Disposal is not expected to have any material effect on the share capital, net assets per share, earnings per share, gearing of CHHB Group for the financial year ending 30 June 2025 based on the audited consolidated financial statements of CHHB for the financial year ended 31 December 2023.
The Proposed Disposal will result in RM596,147.00 gain to the CHHB Group.
10.0 APPROVALS REQUIRED
The Proposed Disposal is not subject to the approval of the shareholders of CHHB. The Proposed Disposal may be subject to the approval or consent from the relevant government authorities, if necessary.
11.0 INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED
Mr. Chua Hee Boon, a Director of CHHB who resigned on 30 May 2025, who is also the Company Secretary of SSISB and holds 0.193% equity interest in CHHB is deemed interested in the Proposed Disposal pursuant to Paragraph 10.08 of the MMLR of Bursa Securities and have abstained from all Board deliberation and voting on the Proposed Disposal during his tenure as Director of CHHB.
Save as disclosed above, none of the other Directors, major shareholders and/or persons connected to the Directors and/or major shareholders have any interest, direct and/or indirect, in the Proposed Disposal.
12.0 TRANSACTION(S) WITH THE SAME RELATED PARTY FOR THE PRECEDING 12 MONTHS
Other than the Proposed Disposal, there was a disposal between the CHHB Group with the same party, Mr. Tang Kiah Ming, for the preceding 12 months from the date of this Announcement which involved the disposal of Magnitude Knight (M) Sdn. Bhd., another wholly owned subsidiary of CHHB, for RM10 million.
13.0 AUDIT COMMITTEE’S STATEMENT
The Proposed Disposal is a related party transaction in view of the directorship of Mr. Chua Hee Boon in CHHB as set out in Section 13 of this Announcement.
The Audit Committee of CHHB, having considered all aspects of the Proposed Disposal, is of the view that the Proposed Disposal is in the best interest of the CHHB Group as the SSA was entered under fair, reasonable and on normal commercial terms which are not detrimental to the interests of the minority shareholders of CHHB.
14.0 DIRECTORS’ STATEMENT
The Board of Directors of CHHB, after considering the rationale of the Proposed Disposal and the recommendation of the Audit Committee of CHHB, is of the opinion that the Proposed Disposal is in the best interest of CHHB Group as the SSA was entered under, fair, reasonable and on normal commercial terms and is not detrimental to the interest of the minority shareholders of CHHB.
15.0 ESTIMATED TIMEFRAME FOR COMPLETION
The Proposal Disposal is expected to be completed within three (3) months from the date of the SSA.
16.0 DOCUMENTS AVAILABLE FOR INSPECTION
The SSA is available for inspection at the registered office of CHHB at 8th Floor, Block A, Mines Waterfront Business Park, No. 3, Jalan Tasik, Mines Resort City, 43300 Seri Kembangan, Selangor Darul Ehsan, Malaysia, during normal office hours from Mondays to Fridays (except public holidays) for a period of three (3) months from the date of this Announcement.
This announcement is dated 12 June 2025.
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