Exsim Hospitality seeks shareholder approval to diversify into construction, centralised procurement

KUALA LUMPUR (Feb 11): Exsim Hospitality Bhd (KL:EXSIMHB) has proposed to diversify into construction works as well as centralised procurement of building materials and household appliances, a move that the company expects to contribute at least 25% of its net profit in the future.

The hospitality operator said the diversification will complement its existing fit-out and hospitality operations, thus reducing reliance on any single business segment.

“This integrated approach is expected to enhance operational coordination between the group’s business segments and improve alignment across project planning, cost control and execution processes,” Exsim said in a filing with Bursa Malaysia.

The company believes the diversification will strengthen its overall project management and delivery capabilities over time.

The group's current core activities include operating its directly owned hospitality assets, providing short-term accommodation and managing third-party-owned serviced residences and boutique hotels, as well as undertaking fit-out works for hospitality assets.

Under the proposed new businesses, Exsim may undertake projects for its own managed properties as well as third-party clients across the hospitality, residential, commercial and corporate sectors.

The new activities are expected to be carried out under its existing wholly owned subsidiary, Exsim Concepto Sdn Bhd, which currently provides specialised fit-out services for hospitality assets.

Exsim Concepto holds a Grade G7 contractor licence, which allows it to tender for construction projects of unlimited size and value.

While Exsim’s past projects were primarily within the fit-out scope, the company said it has completed similar works across other asset classes, including renovations for sales galleries, residential and commercial buildings, as well as bank branches.

Exsim Hospitality added that the new businesses could either contribute 25% or more of its net profit, or involve the diversion of 25% or more of the group’s net assets into activities that differ materially from its existing operations.

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