KUALA LUMPUR, April 22 (Bernama) -- Southern Steel Bhd (SSB) has agreed to sell a 55 per cent stake in wholly owned subsidiary Southern Steel Mesh Sdn Bhd (SSM) to Singapore-based BRC Asia Ltd for RM61.05 million cash in a related party transaction.
SSB is an investment holding company involved in the manufacturing, sale and trading in steel bars, wire rods and related products while SSM deals in steel wire mesh, concrete wires, cut and bend bars.
SSB said in a filing with Bursa Malaysia today the agreement follows an earlier non-binding term sheet signed on Feb 28, 2025, which outlined two corporate actions – the sale of 12.88 million existing shares or 55 per cent stake in SSM and a proposed subscription of new SSM shares by BRC.
However, after further discussions, SSB and BRC decided to proceed solely with the proposed disposal, and the subscription plan was dropped.
Hence, UOB Kay Hian Securities (M) Sdn Bhd, on behalf of the SSB board, announced that the company has today entered into a conditional share purchase agreement with BRC in relation to the proposed disposal.
Upon completion of the proposed disposal, BRC will have 55 per cent stake in SSM, while SSB will retain 45 per cent stake in SSM, making SSM an associate company of SSB, it said.
SSB said the disposal is expected to raise RM61.05 million to be used to support its working capital requirements.
“The proceeds will be primarily channelled towards, among others, payment to suppliers/creditors of the company, general administrative and daily operational expenses such as staff-related costs, utilities, statutory payments and other overhead expenditures.
SSB also mentioned that subject to obtaining the necessary approvals, the proposed disposal is expected to be completed in the second half of 2025, with the company submitting the necessary applications to the relevant authorities within two months.
UOB Kay Hian has been appointed by the company to act as the principal adviser for the proposed disposal.
-- BERNAMA
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