1. INTRODUCTION
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Pursuant to paragraphs 9.19(24) and 10.05(2) of the Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements (“Main LR”), Telekom Malaysia Berhad (“TM”) wishes to announce that its wholly owned subsidiary, Telekom Multi-Media Sdn Bhd (345420-H) (“TMM”) has today entered into a Sale of Shares Agreement (the “SSA”) with Digital Technologies Sdn Bhd (208808-U) (“DTech”) [hereinafter referred to as the “Purchaser”] for the disposal of TMM’s entire 51% equity interest comprising 7,650,000 ordinary shares of RM 1.00 each (“Sale Shares") held in Telekom Smart School Sdn Bhd (486587-W) (“TSS”) to the Purchaser.
On 24 July 1999, TMM entered into a Shareholders Agreement with TSS and other parties as named in paragraph 4 below, who collectively hold 49% equity stake in TSS for the establishment of a joint venture to perform the obligations set out in the Main Contract for the Smart School Flagship Application that was awarded by the Government of Malaysia to TSS at that time.
2.0 SALIENT POINTS OF THE SSA 2.1 Salient points of the SSA are summarized as follows:-.
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- upon execution of the SSA, the Purchaser shall pay to TMM in cash ten per cent (10%) of the Purchase Price as deposit and part payment of the Purchase Price; and
- the balance of the Purchase Price shall be paid by the Purchaser to TMM in cash not later than thirty (30) days from the date of the SSA (“Completion Period”). If the Purchaser fails to pay the balance of the Purchase Price (or any part thereof) on or before the expiry of the Completion Period, TMM shall grant an extension of fourteen (14) days or such longer period as TMM may at its own discretion grant for the settlement of the balance of the Purchase Price.
i) The disposal of Sale Shares by TMM is for a total consideration of RM5,508,000 (the “Purchase Price”) subject to the terms and conditions of the SSA (hereinafter referred to as the “Disposal”).
ii) The consideration for the proposed Disposal was determined on a willing buyer-willing seller basis after taking into consideration the Net Tangible Assets (“NTA”) of the audited financial statements of TSS as at 31 December 2010 of RM10,823,960 or RM0.72 per share.
iii) The Purchase Price payable by the Purchaser to TMM shall be satisfied by cash in the following manner:
iv) TMM will cease to have any interest in TSS upon completion.
3.0 RATIONALE FOR THE PROPOSED DISPOSAL
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The Proposed Disposal provides an opportunity for TM to exit from this investment as the joint venture has long met its investment objectives. Nevertheless, TM is open and will continue working with TSS and its new owner(s) in related education business if the opportunity arises.
4.0 BRIEF INFORMATION ON PARTIES 4.1 TSS
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TSS was incorporated on 22 June 1999 as a joint-venture company between the following registered holders:
| Registered Holders |
% Equity Holdings in TSS
|
| TMM |
51.0
|
| Sapura Technology Berhad (101678-D) |
25.0
|
| KDEB Anzagain Sdn Bhd (472430-T) |
7.0
|
| Educational Trend Sdn Bhd (324657-D) |
7.0
|
| Digital Technologies Sdn Bhd (208808-U) (“DTech”) |
5.0
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| Custommedia Sdn Bhd (210378-U) |
2.5
|
| Multimedia Synergy Corporation Sdn Bhd (445737-D) |
2.5
|
| Total |
100.0
|
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TSS has an authorized share capital of RM20,000,000 comprising 20,000,000 ordinary shares of RM1.00 each and an issued and paid up capital of RM15,000,000 comprising 15,000,000 ordinary shares of RM1.00 each. The principal activity of TSS is to implement the government smart school project, provide multimedia education systems and software, portal services and other related services.
4.2 TMM
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TMM is TM’s wholly owned subsidiary, incorporated on 6 June 1995. It has an authorized share capital of RM5,000,000 comprising 5,000,000 ordinary shares of RM1.00 each and an issued and paid up capital of RM1,650,000 comprising 1,650,000 ordinary shares of RM1.00 each. The principal activity of TMM is as an investment holding.
4.3 DTech
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DTech was incorporated on 30 November 1990. It has an authorized share capital of RM1,000,000 comprising 1,000,000 ordinary shares of RM1.00 each and an issued and paid up capital of RM1,000,000 comprising 1,000,000 ordinary shares of RM1.00 each. The principal activity of DTech is to provide IT facilities management and consultancy services.
5.0 FINANCIAL EFFECT 5.1 Share Capital The Disposal would not have any effect on the issued and paid-up share capital of TM. 5.2 Earnings and Net Assets
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The Disposal is not expected to have any material effect to the earnings and net assets of the TM Group for the financial year ending 31 December 2011.
6.0 DIRECTORS' AND SUBSTANTIAL SHAREHOLDER'S INTEREST
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None of the Directors and other major shareholders of TM and/or persons connected to them have any interest, whether direct or indirect, in the Disposal.
7.0 DIRECTORS’ STATEMENT
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The Board of TM after having considered the rationale of the Disposal is of the opinion that the Disposal is in the best interest of the Company.
8.0 HIGHEST PERCENTAGE RATIO
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The highest percentage ratio pursuant to paragraph 10.02(g) of the Bursa Securities Main LR that is applicable to the Proposed Disposal is 0.07%.
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