KUALA LUMPUR: Pekat Group Bhd
’s subsidiary, Pekat Teknologi Sdn Bhd (PTSB), plans to acquire a 60 per cent stake in Apex Power Industry Sdn Bhd through the purchase of 75,000 shares for RM96 million in cash.
In a filing with Bursa Malaysia today, the solar energy company announced that PTSB has entered into a conditional share sale agreement with sole Apex Power shareholder Low Khek Heng (also known as Low Choon Huat) for the proposed acquisition.
"The proposed acquisition presents an opportunity for the group to establish its presence in the power distribution equipment sector through a 60 per cent equity interest in Apex Power.
"Upon completion, the acquisition will enable the group to expand its product and service range, generate an additional revenue stream, and enhance overall shareholder value,” it said.
Pekat said the proposed acquisition will allow the group to capitalise on the power distribution equipment industry's growth prospects, which are driven largely by infrastructure development.
It said the deal includes an aggregate profit guarantee of RM48 million that Apex Power is expected to achieve over the guaranteed financial years.
"As a result, the acquisition is anticipated to increase Pekat’s profitability by consolidating Apex Power’s profit after tax, thereby strengthening its financial performance,” it added.
In conjunction with the proposed acquisition, Pekat is also seeking to diversify its existing principal activities to include the power distribution equipment segment.
The company expects this new segment to provide an additional revenue stream, positively impacting the group’s earnings.
"The proposed diversification will broaden the group’s earnings base and reduce the business risk associated with reliance on its existing operations," it added. - Bernama
