Cahya Mata Sarawak Bhd’s (CMS) wholly-owned subsidiary Samalaju Industries Sdn Bhd has entered into a binding agreement with OM Materials (S) Pte Ltd for the disposal of its entire 25% equity interests in OM Materials (Sarawak) Sdn Bhd and OM Materials (Samalaju) Sdn Bhd for US$120 million cash.

In a filing to Bursa Malaysia today, CMS stated the offer is subject to various precedent conditions, including approval by the boards of directors of OMS and CMSB.

OM Sarawak principally involved in the sales and processing of ferroalloys and ores.

It owns and operates a ferrosilicon and manganese alloy smelter in Sarawak with an annual production capacity of 200,000 to 210,000 tonnes of ferrosilicon and 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.

As of 29 April, SISB has an issued share capital of RM662.38 million, consisting of 662.38 million ordinary shares, and an issued preference share capital of RM174.76 million, consisting of 174.76 million irredeemable convertible preference shares (ICPS).

As of the latest practicable date prior to this announcement (LPD), the shareholders of SISB and their respective shareholdings in OM Sarawak comprise 165,594,162 ordinary shares in OM Sarawak, representing 25% of OM Sarawak’s issued share capital, and 43,690,300 ICPS in OM Sarawak, representing 25% of OM Sarawak’s ICPS in issue.

On February 19, 2013, OM Samalaju was registered in Malaysia as a private limited company under the Companies Act, 1965.

It primarily provides project development and project management services. It creates and administers capital projects for OM Sarawak. OM Sarawak, like the LPD, has an issued share capital of RM128.31 million, comprising 128.31 million ordinary shares.

The offer’s legality is conditioned on the fulfillment of certain preceding conditions, including the approval of the boards of directors of OMS and CMSB until May 30, 2022.

CMS shares rose 6 sen or 5.6% to RM1.13 in early intraday trade on the news while OMH shares were up 15 sen or 5% to RM2.90. – Source: The Malaysian Reserve