Contents :
1. Further to the announcement of the Company dated 8 June 2001, MIMB is pleased to announce, on behalf of the Board of Directors of K&N, that the Company has received the approval of the Issues and Investment Division of the Securities Commission ("SC") in relation to the following, as proposed by the Company:-
(a) The merger of the stockbroking and futures businesses of K&N and CMS Capital through the acquisitions by K&N from CMS Capital of the entire issued and paid-up share capital of SSSB and SSFSB comprising 180,000,000 and 7,000,000 ordinary shares of RM1.00 each ( share(s) ) in SSSB and SSFSB respectively for a total consideration of RM285,819,225 to be satisfied by an issue of 151,227,103 new K&N shares at an issue price of RM1.89 per share.
(b) The listing of and quotation for the entire new shares of K&N to be issued pursuant to the Proposed Merger on the Main Board of the KLSE.
2. The SCs approval for the above is subject to the following conditions:-
(a) K&N is required to comply with the relevant requirements under the SCs Policies and Guidelines on Issue/Offer of Securities, in particular, as stipulated in Chapters 17 and 25 therein; and
(b) K&N/MIMB to furnish a copy of the final draft circular to the shareholders of K&N for the Proposed Merger for SCs clearance.
3. The implementation of the Proposed Merger is subject to due diligence exercises being carried out by K&N on SSSB and SSFSB, and by CMS Capital on K&N. With reference to this, the SC requires K&N and MIMB to inform the SC of the final consideration for SSSB and SSFSB, and the final issue price of K&N shares to be issued pursuant to the Proposed Merger, after the said due diligence exercises are completed. The SC has further stipulated the following:-
(i) any change to the issue price of K&N shares is subject to a limit of 20%; and
(ii) K&N/MIMB are required to seek SCs consideration for any change to the total number of new K&N shares to be issued pursuant to the Proposed Merger.
With regard to the foregoing, the Board of Directors of K&N wishes to inform that the said due diligence exercises have been completed. In conjunction with this, K&N and CMS Capital have mutually agreed on a final consideration sum of RM282,170,000 and an issue price of RM1.84 per new K&N share, pursuant to which a total number of 153,353,000 new K&N shares would be issued. In view of this, the consideration of the SC will be sought for the change to the number of new K&N shares to be issued.
4. The Proposed Merger is now subject to the approvals of, inter-alia, the following:-
(a) the SC, for the final number of K&N shares of 153,353,000 shares to be issued as consideration for the Proposed Merger;
(b) the KLSE, for the listing of and quotation for the new K&N shares to be issued pursuant to the Proposed Merger;
(c) the shareholders of K&N at an extraordinary general meeting ( EGM ) to be convened for the Proposed Merger; and
(d) the shareholders of CMS Capital (as the vendor of SSSB and SSFSB) and Cahya Mata Sarawak Berhad (as the holding company of CMS Capital) at their respective EGMs to be convened for the Proposed Merger.
For and on behalf of
K&N KENANGA HOLDINGS BERHAD
MALAYSIAN INTERNATIONAL MERCHANT BANKERS BERHAD
This announcement is dated 13 June 2001
c.c Issues and Investment Division
Securities Commission
(Attn. : Mr Wong Wing Seong, Director)