1. INTRODUCTION

The Board of Directors of Uzma (the “Board”) wishes to announce that, Uzma Environergy Sdn. Bhd. (“Enviro”) a wholly owned subsidiary of Uzma had on 1 March 2021 entered into a conditional share sale agreement (“SSA”) with Mr. Mohd Syahrul Nizar Bin Abdul Ghani (“Mr. Syahrul” or “Vendor”) for the acquisition of 49% equity interest in Suria Infiniti Sdn. Bhd. (“SI”) and 100% equity interest in Mahendran Surya Innovations Sdn. Bhd. (“MSI”) (collectively “Acquired Companies”).

Following the Proposed Acquisition, the Company's indirect shareholdings in SI and MSI through Enviro became 49% resulting in SI becoming an associate company of the Company whilst MSI become an indirect wholly-owned subsidiary of the Company.

2. PROPOSED ACQUISITION

2.1 Details of the Proposed Acquisition

Uzma had on 1 March 2021 entered into the SSA with the Vendor for the proposed acquisition of 49% interest in SI representing 490,000 ordinary shares and 100% equity interest representing 500,000 ordinary shares and 2,400,000 preference shares in MSI for a cash consideration of Ringgit Malaysia Five Million Three Hundred and Ninety Thousand (RM 5,390,000.00) (“Purchase Price”).

2.2 Source of funding

The Proposed Acquisition is expected to be funded by internal generated funds.

2.3 Liabilities to be Assumed from the Proposed Acquisition

There are no other liabilities to be assumed by Uzma pursuant to the Proposed Acquisition.

2.4 Completion of Proposed Acquisition

The Proposed Acquisition is expected to be completed on 15 April 2021 (“Completion Date”).

2.5 Salient Terms of the SSA

The Purchase Price shall be payable by Enviro to Vendor via two installments in the following manner and upon the following dates:

(a) Ringgit Malaysia Two Million and Seven Hundred and Fifty Thousand (RM2,750,000.00) (“First Tranche Payment”) on the Completion Date.

(b) Ringgit Malaysia Two Million and Six Hundred and Forty Thousand (RM2,640,000.00) (“Second Tranche Payment”) shall only be payable upon the completion and satisfaction of the Second Tranche Conditions.

3.         INFORMATION ON SI and MSI

3.1 INFORMATION ON SI

(i) Incorporation and Principal Activities

SI is a private company incorporated under the Companies Act, 1965 on 27 September 2012. As at 31 December 2020, SI has an issued share capital of RM1,000,000.00 comprising 1,000,000 ordinary shares of RM1.00 each. The entire issued and paid-up share capital is owned by the Vendor. SI specializes in Renewable Energy (RE) and Energy Efficiency (EE) by means of solar PV and wind system, energy efficiency products, and sustainability reporting by establishing necessary framework as well as monitoring and reporting of carbon footprint.

(ii) Financial Information on SI

The brief financial information of SI is as follows:

(iii) Shareholder

(a)  Mohd Syahrul Nizar Bin Abdul Ghani (1,000,000 shares)

(iv) Director

SI’s directors are as follows:

(a) Mohd Syahrul Nizar Bin Abdul Ghani; and

(b) Norazzah Binti Shahrudin

3.2 INFORMATION ON MSI

(i) Incorporation and Principal Activities

MSI is a private company incorporated under the Companies Act, 1965    on 17 October 2014. As at 31 December 2020, MSI has an issued share capital of RM2,900,000.00 comprising of 500,000 ordinary shares 2,400,000 preference shares. MSI is a service provider for renewable energy particularly solar services.

(ii) Financial Information on MSI

The brief financial information of MSI is as follows:

(iii) Shareholders

(a) Anildeep Sign A/L Rajindar Singh (255,000 shares)

(b) Rajiv Timothy Mei-Liang Mahendran (245,000 shares)

(c) Mohd Syahrul Nizar Bin Abdul Ghani (2,400,000 shares)

(iii)       Director

MSI’s directors are as follows:

(a) Noor Hisham Bin Omar; and

(b) Mohd Syahrul Nizar Bin Abdul Ghani;

4. RATIONALE AND BENEFITS OF THE PROPOSED ACQUISITION

The Proposed Acquisition represents an excellent opportunity for Uzma to enter the renewables energy sector with an established EPCC contractor to capitalize on the opportunities within the solar value chain which includes net energy metering, large scale solar projects and other service portfolios within the renewable energy market. 

Premise on the above, the Board of Uzma believes that the Proposed Acquisition is expected to contribute positively to the overall profitability of the Company and maximize shareholders’ value.

5. FINANCIAL EFFECTS OF THE PROPOSED ACQUISITION

The Proposed Acquisition is expected to contribute positively towards the earnings and net assets per share of the Company for the financial year ending 30 June 2021 and onwards. There is no financial effects on the share capital and substantial shareholders’ shareholdings of the Company for the financial year ending 30 June 2021.

6. PROSPECTS OF THE PROPOSED ACQUISITION

The Acquisition represents an excellent opportunity for Uzma to enter the renewables energy sector with an established EPCC contractor to capitalize on the opportunities within the solar value chain which includes net energy metering, large scale solar projects and other service portfolios within the renewable energy market. 

The Board is of the view that the acquired companies have bright prospects to remain profitable in coming years after the proposed acquisition.

7.  RISK FACTORS

Revenue generated from the proposed solar plant will be entirely dependent on the bid price per kilowatt hour to be confirmed and agreed upon with The Energy Commission through bidding process. These rates have been revised downwards over the years and is at the discretion of The Energy Commission. As such, there will be an uncertainty in terms of the future revenue as of this juncture.

Uzma would further face competition from both new entrants and established players involved in the business of supplying renewable energy to Tenaga National Berhad. Thus, increasing the degree of competition during the bidding process, and decreasing the chances of winning.

8. APPROVALS REQUIRED

The Acquisition is not subject to the approval of the shareholders of Uzma or any government authorities.

9. INTEREST OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS OF UZMA AND PERSONS CONNECTED TO THEM

None of the Directors, substantial shareholders and persons connected to them has any interest, direct or indirect, in the Acquisition.

10. DEPARTURE FROM THE EQUITY GUIDELINES OF SECURITIES COMMISSION ("SC GUIDELINES")

The Board, to the best of its knowledge and belief, is of the opinion that the Acquisition does not result in any departure from the SC Guidelines.

11. STATEMENT BY DIRECTORS

The Board of Directors of Uzma, after careful deliberations on all aspects of the Acquisition, is of the opinion that the Acquisition is in the best interest of the Company.

12. HIGHEST PERCENTAGE RATIO APPLICABLE TO THE PROPOSED ACQUISITION

Pursuant to Paragraph 10.02(g) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the highest percentage ratio applicable to the Subscription is negligible based on the latest audited financial statements of the Company as at 30 June 2020.

13. DOCUMENT FOR INSPECTION

The Acquisition Agreement is available for inspection during normal office hours in Uzma’s office at Uzma Tower, Jalan PJU 8/8A, 2, Jalan PJU 8/8, Damansara Perdana, 47820 Petaling Jaya, Selangor from Mondays to Fridays except public holidays for a period of three (3) months from the date of this announcement.

This announcement is dated 1 March 2021.