| Contents | 1. INTRODUCTION
The Board of Directors of Oversea ("Board") wishes to announce that it had on 3 May 2010 approved the purchase of raw materials from a related company, namely Restoran Oversea (Cheras) Sdn Bhd ("ROCheras"), for a total cash consideration of RM279,684 (the "Acquisition").
2. DETAILS OF THE ACQUISITION
2.1 Information on ROCheras
ROCheras was incorporated in Malaysia as a private limited company under the Companies Act, 1965 on 26 June 1995. The existing authorised share capital of ROCheras is RM1,000,000 comprising 999,000 ordinary shares of RM1.00 each and 1,000 cumulative convertible redeemable preference shares of RM1.00, of which 1,000,000 ordinary shares of RM1.00 each have been fully issued and paid-up.
ROCheras is principally involved in the operation of a restaurant and has ceased operation on 1 April 2010.
2.2 Information on the raw materials
The raw materials consist of dried seafood such as sharks fin, abalone, sea cucumber, frozen seafood and canned products such as abalone and sauces. The raw materials were originally purchased by ROCheras for use in the operation of its restaurant in Menara PGRM, Cheras.
2.3 Original cost of the raw materials
The raw materials were acquired during the operational days of RO Cheras for a total cost of RM253,583.
2.4 Basis of arriving at the purchase consideration
The total purchase consideration of RM279,684 for the Acquisition was derived from a "willing seller, willing buyer" basis after taking into consideration the market value of the raw materials.
2.5 Liabilities to be assumed
There are no liabilities to be assumed by Oversea in respect of the Acquisition.
2.6 Source of funding
The Acquisition would be fully financed by internally generated funds.
3. RATIONALE FOR THE ACQUISITION
ROCheras had not been able to utilize the remaining raw materials after the closure of its operation on 1 April 2010. To prevent wastage, Oversea had decided to acquire such raw materials for consumption in its chain of Chinese restaurants in Malaysia.
4. EFFECTS OF THE ACQUISITION
The Acquisition will not have any effect on the gearing, share capital and substantial shareholders shareholding of Oversea.
The Acquisition is not expected to have any material effect on the earnings per share and net asset per share of Oversea for the financial year ending 31 December 2010.
5. PERCENTAGE RATIO OF THE ACQUISITION
Pursuant to Paragraph 10.02(g) of the ACE Market Listing Requirements of Bursa Malaysia Securities Berhad, the highest percentage ratio of the Acquisition is 0.71% based on the latest audited financial statements of Oversea for the financial year ended 31 December 2009.
6. APPROVALS REQUIRED
The Acquisition is not subject to the approval of the shareholders of the Company or any other relevant authorities.
7. INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED TO SUCH DIRECTORS AND/OR MAJOR SHAREHOLDERS
Save as disclosed below, none of the Directors and/or major shareholders of the Company and/or persons connected with the Directors or major shareholders, have any interest, direct or indirect, in the Acquisition:-
Mr. Yu Soo Chye @ Yee Soo Chye ("YSC") and Madam Lee Pek Yoke ("LPY") are Directors and major shareholders of Oversea and ROCheras. Khong Yik Kam ("KYK") is a Director and major shareholder of Oversea and a director of ROCheras. Accordingly, they are deemed interested in the Acquisition.
YSC, LPY and KYK have abstained from all Board deliberations and voting on the Board resolution pertaining to the Acquisition.
8. TOTAL AMOUNT TRANSACTED WITH THE SAME RELATED PARTY FOR THE PRECEDING TWELVE (12) MONTHS
There were no other transactions with ROCheras for the preceding twelve (12) months from the date of this announcement.
9. ESTIMATED TIMEFRAME FOR COMPLETION OF THE ACQUISITION
Barring unforeseen circumstances, the Acquisition is expected to complete by the second quarter of year 2010.
10. STATEMENTS BY THE BOARD AND AUDIT COMMITTEE
The Audit Committee of the Company, after having considered all aspects of the Acquisition is of the opinion that the Acquisition is in the best interest of Oversea, the terms of the Acquisition are fair, reasonable and on normal commercial terms and is not detrimental to the interest of the minority shareholders.
The Board (save and except for YSC, LPY and KYK) concurred with the Audit Committee's recommendation that the Acquisition is in the best interest of Oversea. The views of the Audit Committee and the Board were arrived at after taking into the consideration the requirements of Oversea and the purchase consideration.
This announcement is dated 3 May 2010. |