Matang buys property assets from Star Media for RM33 mil

• Matang inked an agreement with Star Media’s wholly-owned unit SMG Land Sdn Bhd on Friday (Feb 10), to acquire two units of double-storey semi-detached factory and warehouse annexed with a one-and-a-half-storey office building and other ancillary buildings - which is located within the Star Business Hub, an industrial development project in Bukit Jelutong, Shah Alam.

KUALA LUMPUR (Feb 10): Matang Bhd is buying property assets from Star Media Group Bhd for RM33 million as part of its plan to diversify its business into property investment.

Matang inked an agreement with Star Media’s wholly-owned unit SMG Land Sdn Bhd on Friday (Feb 10), to acquire two units of double-storey semi-detached factory and warehouse annexed with a one-and-a-half-storey office building and other ancillary buildings - which is located within the Star Business Hub, an industrial development project in Bukit Jelutong, Shah Alam.

The RM33 million purchase sum will be satisfied via the allotment and issuance of 357 million new shares in Matang to Star Media at an issue price of 8.09 sen per share, as well as a cash payment of RM4.12 million.

Star Media is expected to hold 13% of the total enlarged number of shares in Matang after such issuance. It is also estimated to realise a net pro-forma gain of about RM15.6 million from the disposal.

This exercise is deemed as related party transactions as MCA (a component party of Barisan Nasional) is a common major shareholder in both groups. MCA holds an indirect stake of 17.15% in Matang; and a direct stake of 43.23% in Star Media.

Matang, which operates primarily through its oil palm business, said in a bourse filing that the property investment business may contribute about 25% of its net profit.

Its net profit for the financial year ended June 30, 2022 (FY2022) rose to RM5.7 million from RM4.1 million in FY2021 as revenue grew to RM17.6 million from RM13.7 million. For 1QFY2023, the group registered a net profit of RM2.1 million on a revenue of RM4.7 million.

The proposals are expected to be completed by the second quarter of 2023.

Shares of Matang closed half a sen or 5.88% higher at nine sen on Friday, giving it a market value of RM203.08 million. Star Media settled flat at 32.5 sen, with a market value of RM236.28 million.