December 9, 2003

Malaysia's QL Resources Full Acquisition of Poultry Farm As Part Of Restructuring Efforts

The Malaysia's QL Resources Bhd proposed restructuring exercise involving its 30 subsidiaries under three core business activities has been positively viewed by investors. 

Affin UOB Research said in its research report said the restructuring would enable the group to focus its attention and allocate its resources more efficiently within three core businesses, as opposed to a multitude of subsidiaries. 

Under the restructuring, QL will acquire the remaining stake in 87.3% - owned Tong Len Poultry Farm Sdn Bhd for RM8.5 million. 

This subsidiary is involved in integrated layer and broiler farming, meehoon manufacturing as well as some oil palm cultivation, crude palm oil milling, property holding and other general trading and distribution activities. It is also acquiring QL Marine Products Sdn Bhd from 100%-owned QL Feedingstuffs Sdn Bhd, which would result in the consolidation of the group's marine based business. 

Another acquisition would be QL Oil Sdn Bhd from Tong Len Poultry Farm, which would consolidate the group's CPO milling activities. 

The company is also proposing to a 1-for-4 bonus issue followed by a share split from RM1 par value to 50 sen. 

Upon the completion, QL's paid up capital would expand to RM75 million from RM60 million. 

Affin UOB and AmResearch said the bonus issue and share split would improve the stock's liquidity in the market.