Pestech shareholders' approve stake sale to IJM Corp, exemption for MGO

KUALA LUMPUR: Pestech International Bhd's shareholders pushed through resolutions to issue 800 million shares in the company to IJM Corp Bhd at 15.5 sen a share at an extraordinary general meeting (EGM) today, paving the way for IJM Corp to take a 44.83 per cent interest in the company.

According to filings with Bursa Malaysia Securities Bhd, 99.9 per cent of shareholders voted for IJM Corp to take the substantial interest in Pestech, and for IJM Corp to be exempted from having to perform a mandatory general offer (MGO) of the shares it does not own in the company.

IJM Corp's offer for Pestech is considered a lifeline for the company which suffered a major setback when Malaysia Airports Holdings Bhd (MAHB) terminated its contract to design and supply the RM743 million Kuala Lumpur International Airport aerotrain project, in August.

According to media reports quoting sources, IJM Corp is a crucial part of Pestech's bid to be reinstated as the main contractor for the RM743 million Kuala Lumpur International Airport (KLIA) aerotrain project.

Under the proposal, Pestech will transfer its 50 per cent stake in wholly-owned subsidiary Pestech Technology Sdn Bhd to the IJM Corp joint-venture (JV) consortium in return for injection of capital and resources into the JV.

Following this, IJM will take the lead in managing the aerotrain project to ensure its completion.

On Aug 16, Pestech received a termination notice from Malaysia Airports Holdings Bhd for the aerotrain project that was awarded in December 2021 due to delays of more than 220 days.

Pestech's share price has been on a roller coaster ride since the IJM Corp deal was announced on July 24, 2023, hitting a low of 23 sen and a high of 39 sen over the last three months.

It hit a low of 23 sen after MAHB announced that it was terminating its contract with Pestech for the KLIA aerotrain project.

Pestech's share price opened unchanged at 33 sen after midday break.

Most Popular
Related Article
Says Stories