TAN CHONG MOTOR HOLDINGS BERHAD
Annual Report 2014
135
NOTES TO THE FINANCIAL STATEMENTS
36. Acquisition of subsidiary (continued)
The goodwill is attributable mainly to the strategic location of the land of Julang Lumayan Sdn Bhd, and the synergies
expected to be achieved from integrating the company’s properties with the Group’s existing properties. None of the
goodwill recognised is expected to be deductible for income tax purposes.
37. Significant events
(i)
On 10 July 2014, the Group received notification from the Ministry of Commerce of the Kingdom of Cambodia
certifying the registration in the Commercial Register of a wholly-owned subsidiary of the Company, named T C
Motor Sales (Cambodia) Pty. Ltd.
(ii) It was disclosed in the Notes to the audited Financial Statements for year ended 31 December 2013 of the Group
that Nissan Vietnam Co., Ltd. (“NVL”), a 74% subsidiary of the Group, received decisions dated 23 September
2013 and 8 October 2013 (“Tax Decisions”) from the Customs Chief of Ha Noi Processing and Investment
Customs Branch (“Vietnamese Customs Authority”) that an amount totalling VND357,028,537,085 equivalent to
approximately USD16.98 million or RM56.27 million, being the additional import duties payable by NVL in respect
of the importation of CKD parts and kits for the period from 2010 to 2012. The additional import duties have been
provided for in the audited Financial Statements of the Group for year ended 31 December 2013. NVL submitted
its appeal against the Tax Decisions. Further to the appeal, NVL received a decision dated 13 August 2014 from
the Vietnamese Customs Authority to cancel the Tax Decisions. Accordingly, the previous provision made has
been reversed in the current financial year.
(iii) On 20 October 2014, the Company received approval from the Securities Commission Malaysia for the
establishment of a Commercial Papers (“CPs”) Programme and a Medium Term Notes (“MTNs”) Programme
with a combined aggregate nominal value of RM1.5 billion. The CPs Programme and MTNs Programme will have
tenures of up to 7 years and 20 years respectively from the date of the first issuance from each of the respective
programmes. The proceeds from the issuance of the CPs and/or MTNs shall be utilised by the Group for its capital
expenditures, repayment of the Group’s bank borrowings, refinancing any CPs and/or MTNs, working capital and
for general corporate purposes of the Group. On 24 November 2014, the Company completed its first issuance of
RM750 million in aggregate nominal value of MTNs.
(iv) On 3 November 2014, Tan Chong Motorcycles (Labuan) Pte Ltd, a wholly-owned subsidiary of the Company,
received a Certificate of Investment dated 31 October 2014 (“Investment Certificate”) from Ho Chi Minh City
People’s Committee confirming the registration of the establishment of a wholly-owned subsidiary named TC
Motorcycles (Vietnam) Company Limited (“TC Motorcycles Vietnam”) for the purpose of importing motorcycles
and motorcycles components for sale to registered dealers in Vietnam and/or the right to export and/or distribute
such motorcycles and motorcycles components (“Project”). The duration of the Project is for a period of 20 years
from the issuance date of the Investment Certificate. The total investment capital for the Project is USD1.0 million
and will be funded via internally generated funds.
(v) On 1 December 2014, TC Motorcycles Vietnam, a wholly-owned subsidiary of the Company, entered into a
Distributorship Agreement (“the Agreement”) with Kawasaki Heavy Industries Ltd. (“KHI”) of Japan whereby TC
Motorcycles Vietnam was appointed as an exclusive distributor to sell completely built-up KAWASAKI brand
sports type motorcycles (excluding mopeds and scooters) and spare parts and accessories in Vietnam. The
distributorship appointment is for a period of three (3) years and is subject to renewal.
(vi) Premium Commence Berhad (“PCB”), a special purpose entity (“SPE”) established for the securitisation of the
Group’s hire purchase receivables, completed the issuance of Notes Series 2014-A of RM198.25 million on 14
November 2014.
The proceeds from the issuance of the Notes were used by the SPE for the acquisition of hire purchase receivables
from TC Capital Resources Sdn. Bhd. (“TCCR”), a wholly-owned subsidiary of the Company. Class A Notes and
Class B Notes amounting to RM182 million and RM4 million respectively, were issued to investors in the debt
capital markets while Class C Notes of RM12.25 million were subscribed by TCCR.
