Aldrich Resources Signs SSA To Acquire Lion’s Share In TACS Group For RM3.9 Million In Cash

Aldrich Resources Berhad (Aldrich) announced today that the Company had on 10 July 2024, entered into a share sale agreement (SSA) with Trustees for TACS Group Staff Fund (TGSB Trustees) for the acquisition of 51,000 ordinary shares in TGSB, representing 51% equity interest of the Target Company for a RM3,866,569.00 purchase consideration.

In a Bursa filing today, Aldrich’s Board said the proposed acquisition entails the acquisition by Aldrich of 51% equity interest in TGSB and the Purchase Consideration shall be satisfied entirely in cash in the following manner to the vendor.

Upon completion of the Proposed Acquisition, TGSB will become a majority-owned subsidiary of Aldrich.

TGSB was incorporated in Malaysia on 8 April 1974 under the Companies Act 1965 as a private limited company. It is principally engaged in investment holding, provision of management, advisory and consultancy services.

TGSB has an existing issued and paid-up capital of RM102,640.00 comprising 100,000 ordinary shares, representing the entire equity interest in the Company. The subsidiaries of TGSB comprises TACS Corporation Sdn Bhd (“TCSB”) and TACS Corporate Services Sdn Bhd (“TCSSB”).

TGSB and its subsidiaries (“TGSB Group”) had earned a Profit after taxation sum of RM795,492 for the financial year ended (“FYE”) 31 May 2023 with a net asset base of RM2,395,152.

The Purchase Consideration was arrived at on a willing-buyer willing-seller basis and will be funded via the internally generated funds of Aldrich and its subsidiaries and/or borrowings (if required).

The Proposed Acquisition represents an opportunity for the Group to acquire a company secretarial services firm which is in-line with the Group’s expansion plan as well as the potential synergistic benefits such as the expansion of clientele base and the streamlining of business functions to be derived from the integration of the Target Company and the Group which is expected to improve the financial performance of the Group in the future.

While the Target Company has been profit-making in the past few years, there is no certainty that the Target Company will continue to register profits in the future post-acquisition, although such risk has been partly mitigated via the Profit Guarantee. The Group expects the earnings of TGSB would contribute positively to the overall financial performance of the Group in the long-term. Aldrich said.

Hence, the Board is of the view that the Proposed Acquisition will contribute to the continued growth of the Group and is expected to enhance the future revenue stream as well as contribute positively to the future earnings of the Group.

The Board expects the Proposed Acquisition to be completed in the 4th quarter of 2024.

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