PETALING JAYA: Sarawak Consolidated Industries Bhd (SCIB) has completed the RM113 million disposal of SCIB Concrete Manufacturing Sdn Bhd (SCM), a landmark transaction that sharpens the company’s focus on its construction and engineering, procurement, construction and commissioning (EPCC) businesses while prompting a reassessment of its capital-raising plans.
SCIB said the completion of the transaction marks a significant step in its ongoing business realignment, following shareholders’ approval for the disposal of SCM and of land at an extraordinary general meeting. The disposal of SCM for a cash consideration of RM113 million enables SCIB to unlock value from its manufacturing business and refocus its resources on its remaining construction and EPCC activities.
With the disposal, SCM ceases to be a subsidiary of the company. As a result, SCIB’s operating structure and funding requirements will be reassessed to reflect its post-disposal business direction.
In line with this development, SCIB will not proceed with the proposed rights issue with warrants based on the current scheme. The company noted that a substantial portion of the proceeds from the earlier proposed rights issue had been earmarked for the construction of factory facilities and the purchase of machinery in relation to SCM’s manufacturing business. Following the disposal, the intended utilisation is no longer relevant to the company’s revised operating structure.
Executive chairman Datuk Chong Loong Men said, “The completion of the SCM disposal is an important milestone for SCIB as it allows us to conclude a major component of our corporate realignment exercise. This exercise allows us to unlock significant value from our manufacturing business and landbank, while strengthening our financial position to pursue larger and more sustainable opportunities in the construction and EPCC space.
“With SCM no longer forming part of the company moving forward, it is only prudent that we reassess our funding requirements and capital plans based on the company’s revised business structure. Our priority is to ensure that any future capital exercise is properly aligned with SCIB’s operational needs, financial position and long-term strategic direction.”
Moving forward, the company may consider a revised rights issue with warrants scheme and submit a fresh application to Bursa Malaysia Securities at a later date, subject to further assessment of the funding requirements.
