John Master to take over China firm
Filed Under (Business News) by Webmaster on 29-07-2009
Tagged Under : Be Top Group, china, John Master Industries
John Master Industries Bhd, which said last month that it planned to sell the business and return capital to shareholders, will stay listed on the local bourse after a reverse takeover by a Chinese textile maker.
It may become the fourth company from China to be listed on Bursa Malaysia once several corporate exercises are completed by the first quarter of next year.
Xingquan International Sports Holdings Ltd, a Chinese shoemaker, was the first direct foreign listing in Malaysia last month. Another China firm, Multi Sports Holdings Ltd, is due to be listed soon.
Sino Hua-An International Bhd was the first China company to go public here via a back-door listing when it took over Antah Holdings Bhd’s listing status in March 2007.
John Master said yesterday that it will sell the entire clothing and property business through an open tender for RM78.5 million and return RM77.5 million, or 63 sen per share, to shareholders after deducting the expenses involved.
After that, it will issue new shares, convertible bonds, and make a rights offer to buy China-based Be Top Group Ltd, the holding company of fabric maker Top Textile (Suzhou) Co, for RM328 million.
Be Top’s owners, Pan Ding and Pan Dong, will own more than 51 per cent of the company after the deal, while John Master’s existing key shareholder, the Ho family, may hold up to 9 per cent. The new owner is providing a profit guarantee of at least 100 million yuan after tax for financial year 2009.
“We are excited with John Master’s re-emergence as a China-based manufacturing powerhouse. Shareholders will have the choice of re-investing in a transformed company or keeping the cash from the capital repayment,” John Master executive director Jackson Ho said in a media briefing in Kuala Lumpur yesterday.
John Master shares rose 8.1 per cent to close at 73.5 sen on Monday before trading was suspended for the announcement yesterday.
Trading in the stock will resume this morning. The stock has risen 67 per cent this year, with most of the gains made in the last one month or so.
Be Top Group received approval to float its shares in Singapore last August, but the plan was put on hold due to the financial crisis. It turned to Malaysia because the stock market here is more stable and less affected by the credit crunch, founder Pan Ding said.
“John Master has also shown great faith in us after visiting our factory in China. The major shareholder is staying on as an investor after the deal. I believe other existing investors will continue to stay on board,” Pan Ding said.
Be Top’s garment products are sold to many well-known brands in China, he added, and the industry has huge potential as the country’s 1.3 billion people are beginning to see clothing as a fashion item rather than basic essentials given the rising affluence.
Be Top’s products are also exported to established Western chain stores like Wal-Mart, Target, Sears, Marks and Spencer, and H&M.
