KUALA LUMPUR: KNM Group Bhd, which is in the midst of a boardroom tussle, is selling its interest in FBM Hudson Italiana SpA for RM110.18 million (EUR22. million) at a loss of RM95 million.
FBM Hudson is a designer and manufacturer of heat exchangers and high-pressure equipment for oil and gas, chemical, petrochemical, oil refining, power and fertiliser.
KNM Group's subsidiary KNM Europa BV has entered into a conditional share purchase agreement with Petro Mat FZCo to dispose of its 100 per cent equity interest in FBM Hudson.
In a filing with Bursa Malaysia Securities today, the Practice Note 17 (PN17) company said Petro Mat was appointed by British Midland FZE to replace it as the purchaser in this transaction.
KNM Group decided to exit the loss-making segment in view of the continued loss-making operations of KNM Europa BV and uncertainty in business prospect.
The expected proceeds from the proposed disposal of FBM Hudson, albeit in tranches, can be reallocated to other viable businesses and for the working requirements within the group.
"The proposed disposal of the entire equity of FBM Hudson Italiana SpA represents an opportunity for KNM Group to unlock and realise the value of the investment made in FBM Hudson at a satisfactory price based on the financial position of the company," it noted.
The group said barring any unforeseen circumstances and subject to all relevant approvals, the board expects the disposal to be completed on October 31 this year or at such other date as the seller and purchaser mutually agreed.
Earlier today, KGB chief executive officer and managing director Ravindrasingham Balasingham appealed to company the company's shareholders to support the current set of board directors and management amid an attempt by a group of shareholders, including German billionaire Andreas Heeschen, to replace the entire board with a new one.
On September 5, Heeschen and eight other shareholders, who collectively own over 10 per cent of KGB, requested an extraordinary general meeting (EGM) to remove the entire board and appoint seven new directors to the company's board.