- In a bourse filing on Wednesday (April 19), GIIB said its wholly-owned subsidiary Big Wheel Green Tyres Sdn Bhd (BWGT) has entered into a sale and purchase agreement with Kozai Realties for the proposed disposal.
- BWGT is engaged in the business of tyres retreading, wholesaling and retailing of new tyres, retread tyres, motor accessories and rubber related products.
KUALA LUMPUR (April 19): Rubber compound manufacturer GIIB Holdings Bhd is selling a 1.689ha parcel of industrial land in Tuaran, Kota Kinabalu, Sabah to metal and steel product wholesaler Kozai Realties Sdn Bhd for RM14 million cash.
In a bourse filing on Wednesday (April 19), GIIB said its wholly-owned subsidiary Big Wheel Green Tyres Sdn Bhd (BWGT) has entered into a sale and purchase agreement with Kozai Realties for the proposed disposal. BWGT is engaged in the business of tyres retreading, wholesaling and retailing of new tyres, retread tyres, motor accessories and rubber related products.
"The disposal consideration of RM14 million is the best offer received thus far," GIIB said. The disposal consideration represents a premium of 88.9% to the latest audited net book value of the land of RM7.41 million as at June 30, 2022.
The original cost of investment for the Tuaran land was RM2.28 million in June 2005.
This is not the group's first attempt at disposing of the parcel of land. In October 2019, GIIB had announced the proposed disposal for RM13 million, but it was subsequently terminated in February 2020.
According to GIIB, the Tuaran land was initially planned to be developed into an industrial park. However, as part of the continuous effort to grow its rubber business, the land was identified as potential for disposal to raise funds for the group’s working capital.
"In light of the volatile property market and uncertain economic conditions, the management has decided to dispose of the land and to focus on the rubber business from 2019.
"The board of directors believes that the proposed disposal of land will provide an avenue for the group to raise funds as additional working capital. as well as to partly repay its bank borrowings and to enjoy interest savings," it said.
Barring any unforeseen circumstances, the proposed disposal is expected to be completed by the third quarter of 2023.
GIIB made headlines throughout 2022 for its dispute with one of its directors — Wong Weng Yew — after his suspension and subsequent dismissal for misconducts. At the same time, Wong made allegations against the company, which resulted in police reports filed against each other and escalated into legal suits.
However, the company was cleared of allegations made by Wong after a forensic audit conducted by independent investigative accountant Ferrier Hodgson MH Sdn Bhd in October 2022.
Wong has also since resigned as a director on Jan 18 ahead of a Jan 19 extraordinary general meeting called for by several substantial shareholders in order to remove him.
GIIB shares closed unchanged at 9 sen on Wednesday, giving the group a market capitalisation of RM53.22 million. Its share price had fallen 10% year to date.