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BURSA MALAYSIA SIGNS AGREEMENT TO ACQUIRE REMAINING 25% EQUITY INTEREST IN BURSA DEPOSITORY.
BackJan 16, 2006
16 Jan 2006
BURSA MALAYSIA SIGNS AGREEMENT TO ACQUIRE REMAINING 25% EQUITY INTEREST IN BURSA DEPOSITORY
Bursa Malaysia today announced that it has entered into a Sale and Purchase Agreement ("SPA") with ABM-MCD Holdings Sdn Bhd ("ABM-MCD") to acquire the remaining 25% equity stake in Bursa Malaysia Depository Sdn Bhd ("Bursa Depository") that it does not already own.
Under the SPA, Bursa Malaysia will acquire 6,250,000 ordinary shares of RM1.00 each in Bursa Depository, for a total consideration of RM35.625 million or RM5.70 each. Upon completion of this proposed acquisition, Bursa Depository will be a wholly-owned subsidiary of Bursa Malaysia.
Incorporated in October 1987 as a private limited company, Bursa Depository provides, operates and maintains a central depository for securities listed on the securities exchange. The company commenced its business in October 1992. Based on the audited accounts for the financial year ending 31 December 2004, Bursa Depository recorded a net profit of approximately RM12.9 million whereas its net tangible assets were approximately RM71.3 million. A total of 343.5 billion units of securities are immobilized and represented by the central depository system operated by Bursa Depository.
"The proposed acquisition completes the consolidation of all market institutions in Malaysia, whereby all the exchanges, clearing houses and depository would be wholly-owned by Bursa Malaysia. The proposed acquisition will also enable us to execute the Group's strategy more efficiently towards improving growth potential and business efficiency," said Yusli Mohamed Yusoff, Chief Executive Officer of Bursa Malaysia.
"We are confident that this transaction will add value in the long term to our shareholders as it provides an additional opportunity for the Group to focus on its core activities more effectively", added Yusli.
The proposed acquisition is pending approval of the Foreign Investment Committee and is expected to be completed by the first quarter of this year.