KUALA LUMPUR (Oct 20): Classic Scenic Bhd’s wholly-owned subsidiary Finesse Moulding (M) Sdn Bhd has acquired a piece of industrial land and a factory on it in Bidor, Perak for a total of RM12.5 million.
In a bourse filing on Wednesday, Classic Scenic announced that its wholly-owned subsidiary had on Oct 20 entered into a sale and purchase agreement with VE Surpass Frame (M) Sdn Bhd for the industrial land measuring 48,275 square meters.
The company said the purchase price will be financed through proceeds to be raised from the proposed private placement of up to 20% of the total number of issued ordinary shares in Classic Scenic announced on Oct 8.
“The company shall fund the shortfall, if any, via internally generated funds and/or bank borrowings,” said the company.
Classic Scenic said the existing manufacturing plant in Rawang is already running at optimum capacity rate, about 80%.
“The group intends to ramp up the production capacity for wooden picture frames and mouldings in the new manufacturing plant located in the said properties in order to capitalise on the higher demand [for] wooden picture frames and mouldings given the positive outlook of the wooden frame industry.
"Furthermore, given that the purchaser is currently renting the said properties from the vendor, it would make better business sense to own the said properties instead of continuing paying rental indefinitely, as well as to avoid the risk of non-renewal of the tenancy agreement,” said the group.
At 5pm, Classic Scenic was up 1.39% to 73 sen, valuing the group at RM175.93 million.
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