Others
| Type | Announcement |
| Subject | OTHERS |
| Description |
Joint Venture Agreement between Tan Chong Construction (Labuan) Pte. Ltd. and An Tam Construction and Trading Co., Ltd. |
1. Introduction
The Board of Directors of Tan Chong Motor Holdings Berhad (“TCMH” or “Company”) wishes to announce that Tan Chong Construction (Labuan) Pte. Ltd. (“TCC(Labuan)”), an indirect wholly-owned subsidiary of TCMH, had on 13 March 2020 entered into a Joint Venture Agreement (“JV Agreement”) with An Tam Construction and Trading Co., Ltd. (“Antaco Vietnam”) to regulate the arrangement relating to the management, operations, affairs and the rights and obligations of the parties as members of a joint venture company to be incorporated in Vietnam under the name of TAN CHONG ANTACO Construction Co., Ltd. or any other name agreed in writing by the parties and approved by the Department of Planning and Investment under the People’s Committee of City at place of registration (“JV Co.”). The JV Co. will be a 60% subsidiary of TCC(Labuan) with 40% held by Antaco Vietnam.
2. Information on TCC(Labuan)
TCC(Labuan) is an investment holding company incorporated on 2 January 2020 in the Labuan Federal Territory, Malaysia with issued share capital of USD1.00 and registered address at 3rd Floor, U0065, Jalan OKK Awang Besar, 87000 Labuan F.T., Malaysia.
3. Information on Antaco Vietnam
Antaco Vietnam is a company incorporated in Vietnam on 15 February 2000 with issued share capital of VND 80,000,000,000 (approximately USD 3,466,000) and registered address at 50/6 Nguyen Dinh Chieu Street, Ward 3, Phu Nhuan District, Ho Chi Minh City, Vietnam.
Antaco Vietnam is principally engaged in civil and industrial construction, infrastructure works, fabrication and erection of steel structure, design and consulting and trade and investment.
4. Information on the Joint Venture
The joint venture is to collaborate and cooperate exclusively with each other by jointly incorporating a JV Co. under the laws of Vietnam to carry out the following businesses:
(i) To secure design contracts, construction contracts and managing projects for project owners;
(ii) To build profitable business by accurate bidding on projects, managing costs and delivering quality work to project owners; and
(iii) To carry out all other construction project activities and such other business as the members of the JV Co. may agree from time to time.
The JV Co. will have an initial charter capital of VND 22,000,000,000 to be contributed by the parties in cash in the following proportion within 90 days from the date on which the JV Co. is issued with the Enterprise Registration Certificate:
|
|
Charter Capital |
Percentage |
|
TCC(Labuan) |
VDN 13,200,000,000 (approximately USD 571,890) |
60% |
|
Antaco Vietnam |
VND 8,800,000,000 (approximately USD 381,262) |
40% |
|
Total |
VND 22,000,000,000 (approximately USD 953,152) |
100% |
The investment in the JV Co. by TCC(Labuan) will be financed through internally generated funds.
The parties shall jointly set up the JV Co. within 60 days after the execution of the JV Agreement.
5. Rationale for the Joint Venture
With TCMH Group’s expansion into Indochina and Myanmar, particularly Vietnam, there are series of projects, i.e. extension of assembly plant, body shop, trim and chassis and new warehouses (“Projects”), that need to be constructed by TCMH Group to cater for the business expansion.
As Antaco Vietnam is currently the contractor for some of the Projects, the JV Co. is to undertake the Projects and the servicing of external clients in the construction industry in the future. The Management believed that a collaboration and sharing of resources between TCMH Group and Antaco Vietnam will benefit both parties and is expected to elevate TCMH Group’s business to the next level in future.
6. Financial Effects
The joint venture will not have any effect on the earnings per share, net assets per share, gearing, share capital and substantial shareholders’ shareholding of TCMH for the financial year ending 31 December 2020.
7. Directors' and Major Shareholders' Interests
None of the Directors, major shareholders and/or persons connected with the Directors and major shareholders of TCMH, has any interest, direct or indirect, in the joint venture.
8. Approval Required
The joint venture is not subject to the approval of the shareholders of TCMH. The JV Agreement shall be terminated if the parties cannot obtain the Investment Registration Certificate and/or the Enterprise Registration Certificate and/or other approval(s) from the relevant authorities in Vietnam required to operate the business within six (6) months from the date of the JV Agreement, unless otherwise agreed between the parties in writing.
9. Directors' Statement
The Board of TCMH having considered all aspects of the joint venture, is of the opinion that the joint venture is in the best interest of TCMH Group.
This announcement is dated 13 March 2020.
Announcement Info
| Company Name | TAN CHONG MOTOR HOLDINGS BERHAD |
| Stock Name | TCHONG |
| Date Announced | 13 Mar 2020 |
| Category | General Announcement for PLC |
| Reference Number | GA1-13032020-00033 |