Malaysia’s MMC Corp, a utilities and infrastructure group, has taken steps to acquire shares in KMB Seaport, the operator of Tanjung Bruas Port in Malacca.
This as MMC Corp signed a conditional share sale and purchase agreement with Seaport Management Services to acquire a 70% share in KMB Seaport for MYR21 million (US$5 million).
In a recent filing to the Malaysian bourse, MMC said it proposed to acquire 7,000 shares and 4.99 million irredeemable convertible cumulative preference shares in KMB Seaport subject to terms and conditions of the purchase agreement.
The acquisition is expected to contribute to the future earnings of the group and will be completed in the first half of 2017, MMC said.
It said this was in line with its initiative to strengthen the group’s financial position through further strategic investments in its core businesses, ports, and logistics.
The purchase “bodes well for MMC group’s effort to maintain its position as a key player in the ports industry in Malaysia,” it added.
The proposed buy-in is a related-party transaction, as Seaport Management’s holding company Seaport Terminal (Johore) is also MMC’s major shareholder
Tanjung Bruas Port, located in the center of the Straits of Malacca, is a small terminal that can handle small to medium-sized vessels, In May last year, KMB Seaport gained a 30-year concession from the federal government and Malacca Port Authority to operate the port.
It seeks to expand the port’s capacity as well as upgrade its equipment and facilities.
Photo: Mithun Ahamed
