Kinsteel wants to list Perwaja

KUALA LUMPUR: Kinsteel Bhd said yesterday it has submitted a proposal to the Securities Commission to list 51%-owned unit Perwaja Steel Sdn Bhd on Bursa Malaysia main board.

The flotation would entail the incorporation of Perwaja Holdings Bhd as the holding company of Perwaja Steel via a share swap with 500 million shares in Perwaja Steel issued to Kinsteel (51%) and Maju Holdings Bhd (49%) respectively, a company statement said.

It would also involve the issuance by Perwaja Steel of 156.12 million 10-year 4% irredeemable convertible unsecured loan stocks (Iculs) in Perwaja Steel to Kinsteel at 10 sen per Icul, convertible into 156.12 million new shares in Perwaja Steel at a conversion price which represents the initial public offering (IPO) price via tendering of one Icul and the balance in cash.

This would be followed by the public issue of 60 million new Perwaja Steel shares and an offer for sale of 90 million shares in Perwaja Steel by Equal Concept Bhd (a subsidiary of Maju) and Kinsteel at IPO price to be determined later, the statement added.

Kinsteel non-executive chairman and Perwaja Steel executive chairman Tan Sri Abu Sahid Mohamed said in the statement it was time to list Perwaja Steel to benefit shareholders following the success of the strategic alliance between Maju and Kinsteel.

He said the flotation would allow Kinsteel to grow its downstream activities of manufacturing sections, bars, wire rods and bolts and nuts.

Kinsteel and Perwaja Steel managing director Tan Sri Pheng Yin Huah said Kinsteel would continue to be an integrated steel manufacturer post-listing. The Perwaja Steel listing, he added, would allow the segregation of its core business.

Pheng said the injection of capital raised from the listing of Perwaja Steel was expected to provide the company the opportunity to expedite future projects that would be earnings enhancing.

the price didnt go up much