Inter Logistics (Cambodia), a subsidiary of Royal Group has released a statement reporting to have purchased 45.09% of the publicly traded Phnom Penh Special Economic Zone (CSX:PPSP).
Official company documents list Oknha Lim Chhiv Ho as the company’s major shareholder owning 45.09% of the 71,875,000 listed shares.
PPSP stock price was trading at KHR 2,000 yesterday putting the estimated purchase price at $15.87 million for 45.09% of listed shares (based upon current stock price valuation).
PPSP share price rose 3.5% to KHR 2,070 today. The company had first listed on the Cambodia Securities Exchange in 2016 with an initial public offering of KHR 2,860 a share.
According to the press release, SBI Royal Securities had brokered the deal stating the trading transaction was authorized by the Securities and Exchange Commission of Cambodia on December 17.
Cambodia Investment Review reached out to PPSP management and SBI Royal Securities but could not confirm further details around the deal.
SBI Royal Securities press release statement on Phnom Penh Special Economic Zone
In the press release, Kith Meng Chairman of the Royal Group of Companies and Inter Logistics (Cambodia) stated: “This acquisition is another great milestone for the development of the Royal Group of Companies.
PPSP is one of the first and biggest SEZ in Cambodia which contributes to the economic development of Cambodia by bringing in more than 95 manufacturing and service companies from 12 different countries and employing more than 32,000 people.
The SEZ services clients from Japan, China, Singapore, The United States, Malaysia, the Netherlands, and Australia in wide-ranging industries including automobile parts, garments, food and beverage, plastic products, electronic products, and jewelry.
In this investment, we will work closely with the management team of PPSP to bring more new technology systems, management, and business strategies, and investors to continue to develop the company and contribute to the society and the economy of the country.”
PPSP ongoing financial concerns
According to the company’s latest filings, PPSP had increased revenue to $5.88 million for the third quarter reporting a $19,238 net profit loss.
Cambodia Investment Review had previously reported on the company’s reported loss of $1.84 million from January to June this year. The loss was attributed to the company not having any land sales for the current quarter.
In November last year, a Notice of Arbitration was lodged at the Singapore International Arbitration Centre by Colben System Pte Ltd, a 51% associate of the Company and Colben Energy Holdings (PPSEZ) Limited (together, the Claimants) against the Company claiming that the Company had breached certain terms of the Joint Venture Agreement entered into by the Company and one of the Claimants.
No dividend has been paid or declared by the Company since the end of the previous financial year. In response, shareholders had approved a share buyback scheme in October last year however this has yet to be completed due to undisclosed reasons.
The company has taken out $18.7 million worth of loans secured by its investment properties valued at $7.91 million that have been pledged as security to secure the term loans granted.
Other substantial shareholders include: WD Infologistics PCL (14.61 percent), Zephyr Co Ltd (14.17 percent) and the most recent major shareholder Ng Lian Soon (9.04%) of the 71,875,000 listed shares