1. INTRODUCTION
The Board of Directors of Nestcon (“the Board”) wishes to announce that the Company had on 9 August 2022 entered into a Memorandum of Understanding (“MOU”) with Nam Heng Safety Glass Sdn. Bhd. (“Nam Heng Glass”) for the purposes of collaboration to explore opportunity for (i) Nestcon and/or its subsidiaries (“Nestcon Group”) to develop solar photovoltaic (“PV”) facilities at properties owned by Nam Heng Glass and/or its related corporations (“Nam Heng Glass Group”) in Malaysia, and (ii) Nam Heng Glass Group to provide the supply of safety glass for potential projects to be undertaken by Nestcon Group (“Proposal”).
(Nestcon and Nam Heng Glass shall hereinafter be collectively referred to as “Parties” and individually as “Party”).
2. INFORMATION ON NAM HENG GLASS
Nam Heng Glass is a company incorporated in Malaysia and its registered address is Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan. Nam Heng Glass is principally engaged in manufacturing and marketing of safety glass, fabrication, installation and graphic design in glass and/or business of glasses trading.
3. SALIENT TERMS OF THE MOU
3.1 Pursuant to the MOU, the Parties hereby agree to explore the collaborative opportunities in relation to the Proposal, which entails but not limited to, the following key scopes and/or initiatives:
(a) Nestcon Group will offer the engineering, procurement, construction and commissioning (“EPCC”) services for roof mounted solar PV system to Nam Heng Glass Group;
(b) Nam Heng Glass Group will offer the supply of safety glass for potential projects to be undertaken by Nestcon Group;
(c) the strategic alliance entails among others Nam Heng Glass Group providing solar panel installation contracts to Nestcon Group for the purpose of Clause 3.1(a) above which Nestcon Group to provide Nam Heng Glass Group for supplying safety glasses for potential projects to be undertaken by Nestcon Group for Clause 3.1(b) above; and
(d) any others as may be mutually agreed by the Parties from time to time during the tenure of this MOU. For avoidance of doubt, any new scopes or initiatives agreed to be entered upon after the date of this MOU shall be made in writing, mutually agreed by both Parties.
3.2 The Parties agree that the MOU shall be non-exclusive.
3.3 The MOU shall remain valid until the soonest of the following occurrences:
(a) expiring of 24 months from the MOU or such longer period as may be mutually agreed between the Parties; or
(b) upon mutual agreement in writing between the Parties to terminate the MOU.
4. RISK FACTORS
The MOU is in the ordinary course of business of Nestcon Group. As such, Nestcon Group will not be exposed to risks that Nestcon Group is not already exposed to. Nevertheless, the Group will take the necessary steps to mitigate the risks as and when they occur.
5. FINANCIAL EFFECTS
(a) The MOU will not have any effect on the issued share capital and the shareholding of the substantial shareholders of Nestcon.
(b) The MOU is expected to contribute positively to the earnings and net assets of Nestcon Group upon the successful implementation and execution of the Proposal.
(c) The MOU is not expected to have any and/or will not have any material effect on the gearing of Nestcon Group.
6. APPROVAL REQUIRED
The MOU is not subject to the approval of shareholders and any other relevant authorities.
7. DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTERESTS
None of the Directors and/or major shareholders of Nestcon or any persons connected with them have any interests, direct or indirect, in the MOU.
8. STATEMENT BY THE BOARD OF DIRECTORS
The Board, having taken into consideration all aspects of the MOU, is of the opinion that this MOU is in the best interest of Nestcon Group.
This announcement is dated 9 August 2022.