Construction and Engineering, Procurement, Construction and Commissioning (“EPCC”) specialist, Sarawak Consolidated Industries Berhad (“SCIB” or the “Company”), today announced that it has completed the RM113.0 million disposal of SCIB Concrete Manufacturing Sdn. Bhd. (“SCM”), a landmark transaction that sharpens the Company’s focus on its Construction and EPCC segment while prompting a reassessment of its capital raising plans.
The completion marks a significant step in SCIB’s ongoing business realignment, following shareholders’ approval for the proposed disposal of SCM and the proposed disposal of lands at the Company’s Extraordinary General Meeting.
The disposal of SCM, which was undertaken for a cash consideration of RM113.0 million, enables SCIB to unlock value from its manufacturing business and refocus its resources on its remaining Construction and Engineering, Procurement, Construction and Commissioning (“EPCC”) activities.
With the completion of the disposal, SCM will cease to be a subsidiary of the Company. As a result, SCIB’s operating structure and funding requirements will be reassessed to reflect the Group’s post-disposal business direction.
In line with this development, SCIB will not proceed with the proposed rights issue with warrants based on the current scheme. The Company noted that a substantial portion of the proceeds from the earlier proposed rights issue had been earmarked for the construction of factory facilities and the purchase of machinery in relation to SCM’s manufacturing business. Following the completion of the disposal, this intended utilisation is no longer relevant to the Group’s revised operating structure.
In conjunction with the Company’s ongoing strategic transformation, SCIB has also appointed Mr. Ben Huang Vui Bing as its new Chief Operating Officer (“COO”). Mr. Ben brings over 13 years of experience in civil and structural engineering, project execution and construction management. As the new COO, he will play a key role in overseeing the Company’s operational execution, project delivery and construction management capabilities as SCIB sharpens its focus on its core Construction and EPCC segment.
Executive Chairman Datuk Chong Loong Men commented,
“The completion of the SCM disposal is an important milestone for SCIB as it allows us to conclude a major component of our corporate realignment exercise. This exercise allows us to unlock significant value from our manufacturing business and landbank, while strengthening our financial position to pursue larger and more sustainable opportunities in the Construction and EPCC space.
With SCM no longer forming part of the Company moving forward, it is only prudent that we reassess our funding requirements and capital plans based on the Company’s revised business structure. Our priority is to ensure that any future capital exercise is properly aligned with SCIB’s operational needs, financial position and long-term strategic direction.”
Moving forward, the Company may consider a revised rights issue with warrants scheme and submit a fresh application to Bursa Malaysia Securities Berhad at a later date, subject to further assessment of the Group’s funding requirements. Should a revised scheme be pursued, SCIB will seek the necessary shareholders’ approval in accordance with regulatory requirements.
The Board remains focused on strengthening the Company’s financial flexibility, improving capital allocation discipline and positioning SCIB to pursue opportunities within its Construction and EPCC segment.
For more information, visit scib.com.my.
