OM Holdings Offers US120 Million To Cahya Mata Sarawak For Balance 25% Stake In Smeltering Plants

OM Materials (S) Pte Ltd (“OMS”) has entered into a binding letter of offer with Samalaju Industries Sdn Bhd a wholly-owned subsidiary of Cahya Mata Sarawak for it to sell all its shares held in OM Materials (Sarawak) Sdn Bhd and OM Materials (Samalaju) Sdn Bhd.

Upon the sale, OM Materials will hold 100% full equity over the two companies, the group currently owns and operates a ferrosilicon and manganese alloy smelter in Sarawak, East Malaysia, with an annual production capacity of approximately 200,000 to 210,000 tonnes of ferrosilicon, and approximately 250,000 to 300,000 tonnes of manganese alloy. The plant also consists of a sinter plant that has a design capacity to produce 250,000 tonnes of sinter ore per annum.

OM Samalaju develops and manages selected capital projects for OM Sarawak. The acquisition is advantageous to the OMH Group and its strategy of investing further in ferroalloy smelting, building organically on the success of the OM Sarawak smelter facility

OM Materials has offered a considerable sum of USD120 million for the purchase which constitutes 165,594,162 ordinary shares representing 25% of the issued and paid-up ordinary share capital of OM Sarawak and 43,690,300 irredeemable convertible preference shares in OM Sarawak, representing 25% of the issued and paid-up preference share capital of OM Sarawak; and 32,077,500 ordinary shares in OM Samalaju, representing 25% of the issued and paid-up share capital of OM Samalaju.

OMH intends to fund the Purchase Consideration through a combination of existing cash reserves, future operating cash flows, and/or bank borrowings, and/or equity raising in the second half of 2022. On the Proposed Transaction, Mr Low Ngee Tong, Executive Chairman and Chief Executive Officer of OMH commented: “We appreciate the past contributions by our partner, Cahya Mata Sarawak Berhad, to the Sarawak Project. Together with our recent secondary listing in Bursa, Malaysia, this transaction marks a key milestone in our journey and complements the wider OMH strategy of growing our Sarawak smelter and becoming the leading supplier of ferroalloys globally – building significant value for all

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