Chin Hin Group Property Bhd (CHGP) expects to record a RM7.63 million loss before tax from its proposed RM62 million disposal of four subsidiaries, but said the transaction is not expected to materially affect the group’s future financial performance.
In a reply to Bursa Malaysia’s query, CHGP said the RM62 million consideration compares with the target companies’ combined net assets of RM69.63 million as at Aug 31, 2026, resulting in the estimated RM7.63 million disposal loss.
The proposed transaction involves the disposal of its entire interests in Boon Koon Vehicles Industries Sdn Bhd (BKVI), BKCV Sdn Bhd, Boon Koon Fleet Management Sdn Bhd and BK Fleet Management Sdn Bhd.
CHGP said the target companies contributed only 8% of group revenue in FY2025 and 6% in the first eight months of 2026, with revenue of RM81.63 million and RM30.70 million respectively. On this basis, the group does not expect the disposals to have a material adverse effect on future financial performance.
A major component of the transaction is the agreed RM60 million value of properties owned by BKVI in Seberang Perai Selatan, Penang.
The properties comprise five freehold plots with a total gross floor area of about 21,622 square metres, housing a factory, office buildings, warehouse and ancillary structures.
Independent valuer Henry Butcher Malaysia Sdn Bhd valued the properties at RM60 million on Sept 15, 2026, using the cost and comparison approaches. Their net book value stood at RM43.31 million as at Aug 31.
CHGP also clarified why the current RM62 million deal differs from an earlier RM74 million disposal proposal announced in August 2025.
It said the previous deal was negotiated on an “as is where is” basis, while the latest transaction requires bank borrowings, inter-company balances and shareholder loans to be settled and cash balances extracted before completion.
CHGP said BKVI’s RM3.79 million net loss in FY2025 was mainly due to a RM615,718 impairment on trade receivables and a RM3.07 million inventory write-down.
BKCV’s weaker 2026 performance, meanwhile, was attributed mainly to RM2.1 million in customs assessment-related costs and professional fees linked to the importation of Cergas Van vehicles.
CHGP added that the transaction carries no conditions precedent, while RM6.2 million of the proceeds will be used to repay amounts owing to BKVI.
