MMM Group Berhad’s proposed regularisation plan has been rejected by Bursa Malaysia Securities Berhad, raising the risk of the company being delisted unless it successfully appeals the decision or submits an acceptable alternative.
The PN17 company said Bursa Securities had rejected its proposed regularisation plan after concluding that the company and its principal adviser had failed to demonstrate that the proposal complied with the requirements of the Main Market Listing Requirements.
The proposed regularisation plan comprised a share consolidation, private placement, rights issue with warrants, acquisition of a billboard operator, and a share capital reduction.
Bursa’s primary concern centred on MMM’s proposed acquisition of 100% equity interest in EDSB for RM16 million in cash, which forms the cornerstone of the regularisation plan.
The exchange noted that the acquisition price represented a substantial premium over EDSB’s net assets of approximately RM800,000 as at Dec 31, 2025.
It also highlighted that MMM would ultimately need to invest about RM22.16 million after factoring in the planned conversion of 26 out of EDSB’s 228 static billboards into digital billboards.
Although the vendors had guaranteed a cumulative profit after tax of RM6 million over the financial years ending 2026 to 2028, Bursa said the guaranteed earnings were significantly lower than the acquisition consideration and did not sufficiently demonstrate the long-term sustainability of EDSB’s earnings beyond the profit guarantee period.
The regulator also questioned the alignment of interests between the vendors and MMM’s shareholders, noting that the acquisition would be settled entirely in cash, leaving the vendors without any equity participation in the enlarged group.
Bursa concluded that it was not evident the proposed acquisition adequately safeguarded the interests of MMM and its shareholders or would result in a sustainable enhancement in shareholder value.
Bursa also expressed concerns over the long-term viability of EDSB and the enlarged group following the acquisition.
EDSB’s revenue has declined steadily over the past three financial years, falling from RM8.62 million in FY2023 to RM6.09 million in FY2025, while the company recorded losses in three of the last four financial years.
The exchange said it remained unclear whether the acquisition and the planned billboard upgrades would be sufficient to reverse the company’s weakening business momentum.
Regulatory compliance was another key concern.
Of EDSB’s 228 billboard sites, only 62 currently possess the necessary advertising licences and permits. While completion of the acquisition is conditional upon approvals being obtained for 144 operating sites, EDSB expects these approvals only by the second quarter of 2027.
Bursa noted that MMM may subsequently need to incur additional costs and resources to regularise the remaining billboard sites, creating uncertainty over future operations and exposing the company to potential regulatory enforcement risks.
In addition, Bursa observed that only 26 of the 228 static billboards are planned for digital conversion under the proposed investment programme, suggesting MMM may require significant future capital expenditure should it wish to modernise the remaining assets.
Although MMM recorded improved financial performance in FY2026 and proposed a share capital reduction that would eliminate accumulated losses of RM32.65 million, Bursa said the improvement was largely driven by accounting adjustments rather than sustainable operational profitability.
The exchange maintained that the proposed regularisation plan had not sufficiently addressed the underlying circumstances that caused MMM to trigger PN17 status, particularly given the uncertainties surrounding the proposed acquisition.
MMM has until Aug 9, 2026 to appeal Bursa Malaysia’s decision.
