Under the transaction, Pelikan International will sell 28% of its interest in PGG, while subsidiaries Pelikan Holdings AG (PHAG) and Molkari Vermietungsgesellschaft mbH & Co Objekt Falkensee KG will sell 51.36% and 20.64% of their respective shares to Holdham.
Holdham is a France-based manufacturer and distributor of school and office supplies.
The disposal would see the group’s assets consisting of more than 70% cash, classifying it as a Practice Note 16 (PN16) company, also known as a cash company.
Meanwhile, PHAG’s two other subsidiaries – Pelikan PBS-Produktiongesellschaft MBH (PPG) and Pelikan PBS-Produktion Verwaltungs-GMBH (PBS) – will also be transferred to Holdham for a nominal fee of 1 euro (RM4.86) each.
Pelikan International said in its filing with Bursa Malaysia today that it aims to realise its investment value in the disposed companies due to challenges in distribution channels, production technology, and the global economy.
Of the RM695.44 million sale proceeds, RM182.71 million will be used for working capital and settlement of liabilities, repayment of bank borrowings, and to cover estimated expenses from the proposals.
The remaining RM512.72 million will be distributed within six months from the completion of the sale, via a special dividend and/or a capital repayment.
The group plans to distribute the remaining proceeds to shareholders on a pro-rata basis contingent on two possible scenarios.
One scenario is if the group fails to submit a proposal to acquire a new core business to the Securities Commission within 12 months of receiving PN16 status from Bursa.
The other scenario is if the group decides not to retain its listing status after being classified as a PN16 company.
The board of directors expects the proposals to be completed by the fourth quarter of 2023.
Interestingly, the group’s share price has performed exceptionally well, up 250% or 61 sen to 84.5 sen in the last one year.
At market close, the group’s share price was flat at 85.5 sen, valuing the company at RM516.93 million.