SYMPHONY HOUSE BERHAD

Transcription

1 THIS STATEMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. Bursa Malaysia Securities Berhad ( Bursa Securities ) has not perused the Proposed Share Buy-Back ( Statement ) prior to its issuance as it is exempted pursuant to the provisions of Practice Note 18 of the Main Market Listing Requirements of Bursa Securities. As such, Bursa Securities takes no responsibility for the contents of this Statement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Statement. Shareholders should rely on their own evaluation to assess the merits and risks of the proposal set out herein. SYMPHONY HOUSE BERHAD (Company Number : P) (Incorporated in Malaysia under the Companies Act, 1965) STATEMENT TO SHAREHOLDERS IN RELATION TO THE PROPOSED RENEWAL OF AUTHORITY FOR THE COMPANY TO PURCHASE ITS OWN ORDINARY SHARES OF UP TO 10% OF THE ISSUED AND PAID UP SHARE CAPITAL OF THE COMPANY ( PROPOSED SHARE BUY-BACK ) The abovementioned proposal will be tabled as Special Business at our Thirteenth Annual General Meeting ( AGM ) to be at Topas Room, The Saujana Hotel, Saujana Resort, Jalan Lapangan Terbang SAAS, Shah Alam, Selangor Darul Ehsan, Malaysia on Wednesday, 30 September 2015 at a.m. The Notice of the AGM and the Form of Proxy are enclosed in our 2015 Annual Report which is sent together with this Statement. For a proxy to be valid, you are requested to complete and deposit the Form of Proxy at our Registered Office at Level 8, Symphony House, Pusat Dagangan Dana 1, Jalan PJU 1A/46, Petaling Jaya, Selangor Darul Ehsan, Malaysia on or before a.m. on 28 September 2015 if you are unable to attend the Meeting or adjourned meeting (as the case may be). If you are a corporation, the Form of Proxy should be executed under common seal or under the hand of an officer or attorney duly authorised in writing. If the Form of Proxy are executed by an officer or attorney duly authorised in writing, supporting documents are to be produced on the day of the AGM for verification by the Company Secretary. The lodging of the Form of Proxy does not preclude you from attending and voting in person at the Meeting should you subsequently wish to do so. This Statement is dated 28 August 2015

2 DEFINITIONS Except where the context otherwise requires, the following definitions shall apply throughout this Statement: Act : Companies Act, 1965, as amended from time to time and any re-enactment thereof AGM : Annual General Meeting Board : Board of Directors of Symphony Bursa Securities : Bursa Malaysia Securities Berhad EPS : Earnings per share Listing Requirements : Listing Requirements of Bursa Securities that are applicable for the Main Market of Bursa Securities Proposed Share Buy-Back : Proposed renewal of the authorisation for the Company to buy-back and hold not more than 10% of the issued and paid up share capital of the Company Purchased : purchased under the share buy-back Share Buy-Back Authority : The authority conferred by our shareholders on 30 June 2014 for the Share Buy-Back Statement Symphony or Company : : Statement to shareholders in relation to the Proposed Share Buy-Back Symphony House Berhad ( P) Symphony Group or Group Symphony Share(s) / Share(s) : Symphony and its subsidiaries : Ordinary share(s) of RM0.10 each in Symphony RM and sen : Ringgit Malaysia and sen respectively Words importing the singular shall include the plural and vice versa and words importing the masculine gender shall, where applicable, include the feminine and neuter genders and vice versa. Reference to persons shall also include corporations. All references to the time of day in this Statement are references to Malaysian time. All references to our Company and Symphony in this Statement are to Symphony House Berhad, references to our Group are to our Company and our subsidiaries and references to we, us, our and ourselves are to our Company and, save where the context otherwise requires, shall include our subsidiaries. All references to you in this Statement are to the shareholders of our Company. i

3 Page STATEMENT TO SHAREHOLDERS IN RELATION TO PROPOSED SHARE BUY-BACK 1. INTRODUCTION DETAILS OF THE PROPOSED SHARE BUY-BACK RATIONALE OF THE PROPOSED SHARE BUY-BACK POTENTIAL ADVANTAGES AND DISADVANTAGES OF THE PROPOSED SHARE BUY-BACK FINANCIAL EFFECTS OF THE PROPOSED SHARE BUY-BACK HISTORICAL SHARE PRICES APPROVAL REQUIRED DIRECTORS AND SUBSTANTIAL SHAREHOLDERS INTERESTS CORPORATE PROPOSALS ANNOUNCED BUT PENDING COMPLETION DIRECTORS RECOMMENDATION APPENDIX EXTRACT OF THE NOTICE OF OUR THIRTEENTH AGM ii

4 SYMPHONY HOUSE BERHAD (Company Number : P) (Incorporated in Malaysia under the Act) STATEMENT IN RELATION TO THE PROPOSED SHARE BUY-BACK 1. INTRODUCTION At our last AGM on 30 June 2014, we had obtained the approval from you to purchase up to 10% of our issued and paid up in the open market. The Share Buy-Back Authority, unless renewed, shall lapse at the conclusion of our forthcoming AGM in accordance with the Listing Requirements. We had announced on 19 August 2015 that we are proposing to seek shareholders approval at our forthcoming AGM for the Proposed Share Buy-Back. The purpose of this Statement is to provide you with the information on the Proposed Share Buy-Back and to seek your approval for the resolution pertaining to the said proposal to be tabled at our forthcoming AGM. You are advised to read and consider the contents of this Statement carefully before voting on the relevant resolution to be tabled at the forthcoming AGM. The Notice of AGM and the Form of Proxy are enclosed in our 2015 Annual Report, which is sent together with this Statement. 2. DETAILS OF THE PROPOSED SHARE BUY-BACK 2.1 Introduction Our Board proposes to seek the approval from our shareholders for the renewal of the authority for our Company to purchase and/or hold from time to time and at any time up to 10% of our issued and paid up for the time being. As at 3 August 2015, the issued and paid up share capital of Symphony is RM66 million comprising 660 million. The maximum number of which may be purchased and/or as treasury shares by the Company will be up to ten per centum (10%) of the issued and paid up share capital of the Company. Therefore, the maximum number of which may be purchased under the Proposed Share Buy-Back is up to 66 million. 1

5 The authorisation for the Proposed Share Buy-Back will be effective immediately upon the passing of the ordinary resolution in relation to the Proposed Share Buy-Back at the forthcoming AGM to be on 30 September 2015 until: (a) (b) (c) the conclusion of our next AGM unless by a resolution passed at the next AGM, the authority is renewed; or the expiration of the period within which the next AGM is required by law to be ; or revoked or varied by an ordinary resolution of our shareholders in a general meeting, whichever is the earliest. 2.2 Funding The maximum amount of funds to be allocated by the Company for the Proposed Share Buy-Back shall not exceed the aggregate of the retained profits and/or the share premium accounts. As at 31 March 2015, the audited share premium reserves and accumulated losses of Symphony (Company level) stood at RM51.6 million and RM38.3 million respectively. The Proposed Share Buy-Back will be funded from internally generated funds and/or borrowings, the proportion of which have not been determined at this juncture and will depend on the number of we purchase and the price paid for the Purchased. In this regard, our Board shall be mindful of our repayment capabilities when considering the use of borrowed funds to fund the Proposed Share Buy-Back. 2.3 Treatment of Purchased The Proposed Share Buy-Back is subject to compliance with Section 67A of the Act and our Board will deal with the Purchased in the following manner: (a) (b) (c) cancel the Purchased ; retain the Purchased in treasury for distribution as dividends to our shareholders and/or for resale on the market of Bursa Securities in accordance with the relevant rules of Bursa Securities and/or for cancellation at a later date; or retain part of the Purchased as treasury shares and cancel the remainder. 2.4 Ranking While the Purchased are as treasury shares, the rights attaching to them in relation to voting, dividends and participation in other distribution and otherwise are suspended. The treasury shares would not be taken into account in calculating the number or percentage of shares or of a class of shares in our Company for any purposes including the determination of substantial shareholdings, take-overs, notices, the requisitioning of meetings, the quorum for meetings and the result of a vote on resolution(s) at meetings. 2

6 2.5 Regulatory Requirements In accordance with the Listing Requirements, we may only purchase our own at prices not more than 15% above the weighted average market price of our own for the five (5) market days immediately before the date of purchase. Further, we may only resell the treasury shares on Bursa Securities at: (a) (b) a price which is not less than the weighted average market price of our for the five (5) market days immediately before the resale; or a discounted price of not more than 5% to the weighted average market price of our for the five (5) market days immediately before the resale provided that: (i) (ii) the resale takes place not earlier than thirty (30) days from the date of purchase; and the resale price is not less than the cost of purchase of the Purchased being resold. As at 3 August 2015, being the latest practicable date prior to the printing of this Statement, million representing 59.5% of our issued and paid up capital were by public shareholders. Pursuant to the Proposed Share Buy-Back, assuming that we implement in full and that the Purchased are from public shareholders, the public shareholding spread would reduce to approximately 55.1%. Our Board undertakes to purchase only to the extent that not less than 25% of our issued and paid up are in the hands of public shareholders at all times, as required under the Listing Requirements. Based on the present shareholdings as shown in Section 8 of this Statement, none of the Directors and Substantial shareholders of the Company will be required to make a mandatory general offer under the Malaysian Code on Take-Overs and Mergers, 2010 arising from the Proposed Share Buy-Back. 2.6 Purchase or Distribution of Treasury Information on the purchased by Symphony is stated in the Additional Compliance Information section of the 2015 Annual Report, whereby Symphony had purchased 25,000 in the financial period ended 31 March As at 3 August 2015, Symphony a total of 350,016 treasury shares. 3

7 3. RATIONALE FOR THE PROPOSED SHARE BUY-BACK The Proposed Share Buy-Back allows us to utilise our surplus financial resources to purchase our own, when appropriate, and at prices which our Board views as favourable. In addition, the Proposed Share Buy-Back is also expected to stabilise the supply and demand of our in the open market and thereby supporting its fundamental value. If the Purchased are cancelled at such time(s) where our Directors are of the view that there is excess share capital and wish to reduce the number of in circulation, it would enhance our consolidated EPS and long term and genuine investors are expected to enjoy a corresponding increase in the value of their investments in our Company. If the Purchased are as treasury shares, such may potentially be resold on Bursa Securities at a higher price and therefore realising a potential gain in reserves without affecting the total issued and paid up of our Company. The treasury shares may also be distributed to our shareholders as share dividends and, if undertaken, would serve to reward our shareholders. 4. POTENTIAL ADVANTAGES AND DISADVANTAGES OF THE PROPOSED SHARE BUY-BACK 4.1 Potential Advantages The potential advantages of the Proposed Share Buy-Back are as follows: (i) (ii) to utilise our financial resources more efficiently especially where there are no immediate use. If the purchased are subsequently cancelled, this may strengthen the Group s consolidated EPS and the return on equity as indicated in Section 3 above. the financial resources of our Group may increase pursuant to the resale of the Purchased as treasury shares at prices higher than the purchase price. In this connection, our Board will be mindful of the interests of our Group and our shareholders in implementing the Proposed Share Buy-Back and in subsequent resale of the treasury shares on Bursa Securities, if any. 4.2 Potential Disadvantages The potential disadvantages of the Proposed Share Buy-Back are as follows: (i) (ii) if implemented, would reduce the financial resources of our Group. This may result in our Group having to forego future investment opportunities and/or any interest income that may be derived from the deposit of such funds in interest bearing instruments. it may also result in a reduction of financial resources available for working capital as well as for distribution in the form of cash dividends to our shareholders. Nevertheless, the Proposed Share Buy-Back is not expected to have any potential material disadvantage to our Company and its shareholders, as it will be implemented only after careful consideration of the financial resources of the Group and its resultant impact. 4

8 5. FINANCIAL EFFECTS OF THE PROPOSED SHARE BUY-BACK 5.1 Share capital The effect of the Proposed Share Buy-Back on our issued and paid up share capital will depend on the treatment of the Purchased. In the event that all the are purchased and cancelled, the issued and paid up share capital of Symphony will be as follows: Symphony Amount RM Existing issued and paid up share capital as at 3 August 2015 If maximum number of shares are purchased pursuant to the Proposed Share Buy-Back Issued and paid up share capital, if the treasury shares are cancelled in full 660,000,000 66,000,000 (66,000,000) (6,600,000) 594,000,000 59,400,000 However, if all the so purchased are retained as treasury shares, there will not be any effect on the issued and paid up share capital of the Company. 5.2 Earnings The effects of the Proposed Share Buy-Back on our consolidated earnings would depend on the number of purchased under the Proposed Share Buy-Back, purchase price paid for the Purchased and the effective funding cost for us to finance the Proposed Share Buy-Back (if applicable) or any loss in interest income to us. The reduction in the number of our applied in the computation of the consolidated EPS pursuant to the Proposed Share Buy-Back (whether the Purchased are as treasury shares or cancelled) may generally, all else being equal, have a positive impact on our consolidated EPS for the financial year when the Proposed Share Buy-Back is implemented. Should the Purchased be as treasury shares and later resold, the extent of the impact to our consolidated earnings will depend on the actual selling price, the number of treasury shares resold, the effective funding cost (if applicable), the gain or loss on the acquisition and the manner in which the proceeds arising therefrom are utilised. 5

9 5.3 Net assets The effects of the Proposed Share Buy-Back on our consolidated net assets per share would depend on the number of Purchased, purchase price paid for the Purchased, the effective funding cost for us to finance the Proposed Share Buy-Back (if applicable) or any loss in interest income to us and whether the Purchased are cancelled or retained as treasury shares. (a) If the Purchased are cancelled: The Proposed Share Buy-Back will reduce our consolidated net assets per Share if the purchase price per Share exceeds the consolidated net assets per Share at the relevant point in time and vice versa. (b) If the Purchased are retained as treasury shares: Our consolidated net assets would decrease by the cost of the treasury shares due to the requirement for the treasury shares to be carried at cost and be offset against equity. If the treasury shares are resold on the Bursa Securities, our consolidated net assets would increase if we realise a gain from the resale and vice versa. If the treasury shares are distributed as share dividends, our consolidated net assets per Share would decrease by the cost of the treasury shares. 5.4 Working capital and cash The Proposed Share Buy-Back is likely to reduce our cashflow and working capital, the quantum of which will depend on the purchase prices and the number of so purchased. If the Purchased are subsequently resold, our working capital and cashflow will increase, the quantum of which will depend on the actual selling prices and the number of sold. [This space is intentionally left blank] 6

10 6. HISTORICAL SHARE PRICES The monthly highest and lowest prices of Symphony traded on Bursa Securities for the past twelve (12) months prior to the issuance of this Statement are as follows: 2014 HIGH RM LOW August September October November December RM 2015 January February March April May June July Last transacted market price on 3 August 2015, being the latest practicable date prior to despatch of this Statement RM0.155 Source: Bloomberg 7. APPROVAL REQUIRED The Proposed Share Buy-Back is subject to the approval from the shareholders of the Company at the forthcoming AGM. 8. DIRECTORS AND SUBSTANTIAL SHAREHOLDERS INTERESTS None of our directors or substantial shareholders and/or persons connected to our directors and/or substantial shareholders, has any interests, direct or indirect, in the Proposed Share Buy-Back or resale of the treasury shares (if any in the future), other than, if applicable, as shareholders of our Company. The effect of the Proposed Share Buy-Back on the shareholdings of our directors and substantial shareholders based on the registers as at 3 August 2015 assuming the Company implements the Proposed Share Buy-Back in full and that the purchased are from public shareholders are illustrated below: 7

11 Directors Shareholdings Tan Sri Mohamed Azman Yahya Abdul Hamid Sheikh Mohamed Datuk Khairil Anuar bin Abdullah Number of as at After the Proposed Share Buy-Back 3 August Direct Indirect Direct Indirect %* 000 %* 000 %* 000 %* 11, , (1) 11, , (1) 3, , Tony Foo San Kan 6, , Mohd Adzahar Abdul Wahid Substantial Shareholders Shareholdings Number of as at After the Proposed Share Buy-Back 3 August Direct Indirect Direct Indirect %* 000 %* 000 %* 000 %* Virtuoso Capital Sdn Bhd 133, , Symphony Life Berhad 76, , Tan Sri Mohamed Azman Yahya Gajahrimau Capital Sdn Bhd 11, , (1) 11, , (1) , (2) , (2) Notes: 1 Indirect interest by virtue of his interests in Virtuoso Capital Sdn Bhd, Azman & Sons Sdn Bhd and Symphony Life Berhad pursuant to Section 6A of the Act 2 Indirect interest by virtue of its direct and/or indirect interest in Symphony Life Berhad pursuant to Section 6A of the Act * Excluding a total of 350,016 ordinary shares bought back by Symphony House Berhad and retained as treasury shares. [This space is intentionally left blank] 8

12 9. CORPORATE PROPOSALS ANNOUNCED BUT PENDING COMPLETION The Board of Symphony confirms that as at the latest practicable date prior to the printing of this Statement, 3 August 2015, save for the Proposed Share Buy-Back and disclosed below, there are no other corporate proposals announced but pending completion by the Company. Proposed reverse take-over of Symphony by Ranhill Energy and Resources Berhad ( Ranhill Energy ), being the ultimate holding company of Ranhill Group Sdn. Bhd. (formerly known as Ranhill Power Sdn. Bhd.)( RGSB ) via a special purpose vehicle, being Ranhill Holdings Berhad ( Ranhill Holdings ) ( Proposals ) On 26 March 2014, on behalf of the Board of Directors of Symphony, CIMB Investment Bank Berhad ( CIMB ) announced that the Company has entered into a heads of agreement with Ranhill Energy for the Proposals. CIMB announced that in view of the on-going negotiations and due diligence, Symphony and Ranhill Energy had, on 26 May 2014, mutually agreed to extend the exclusivity period of the heads of agreement entered into between Symphony and Ranhill Energy on 26 March 2014 for the Proposals to 30 June On 20 June 2014, Symphony and Ranhill Holdings, a new special purpose vehicle incorporated for the purposes of the Proposals, entered into a scheme of arrangement ( SOA ) under Section 176 of the Companies Act, 1965 for the exchange of ordinary shares of RM0.10 each in Symphony into ordinary shares of RM1.00 each in Ranhill Holdings ( Ranhill Holdings ) at an exchange ratio of 1 Ranhill Holdings for every 10 existing Symphony at an entitlement date to be determined and announced later. On 28 November 2014, Symphony announced that Ranhill Holdings had entered into supplemental agreements to the SOA, RGSB Companies Share Sale Agreement and Ranhill Utilities Sdn Bhd Companies Share Sale Agreement to amend and vary certain terms of the Proposals. Pursuant to the agreements, on 1 December 2014, Symphony had submitted an application to the Securities Commission ( SC ) for the approval of the Proposals and to Bursa Securities for its clearance of the contents of the Explanatory Statement/Circular to shareholders of Symphony. Subsequently, on 17 December 2014, Symphony announced that it had submitted an applications to Shariah Advisory Council of SC for the classification of Ranhill Holdings as Shariah-compliant securities, an application to the Ministry of International Trade and Industry for the proposed transfer of listing status of Symphony to Ranhill Holdings, admission of Ranhill Holdings to the Official List of Bursa Securities and the listing of and quotation for Ranhill Holdings on Main Market of Bursa Securities. On 22 April 2015, Ranhill Holdings and RGSB entered into a supplemental agreement for the RWorley Call Option Agreement dated 20 June 2014 ( Supplemental Agreement ). 9

13 The salient terms of the Supplemental Agreement include the following amendments to the Ranhill WorleyParsons Sdn Bhd ( RWorley ) Call Option Agreement: (i) the exercise period for the call option granted by RGSB to Ranhill Holdings to acquire RGSB s entire 51.0% equity interest in RWorley pursuant to the Proposed RWorley Call Option, has been extended from 3rd month to 6th month to 3rd month to 18th month from the date of completion of the proposed offering; and (ii) the method of settlement of the call option price has been amended from settlement fully made in shares in Ranhill Holdings to settlement via a combination of cash and shares in Ranhill Holdings at an issue price and in a proportion, to be determined and mutually agreed by Ranhill Holdings and RGSB upon the exercise of the call option. On 15 July 2015, SC has approved the Proposals subject to certain terms and conditions. 10. DIRECTORS RECOMMENDATION Your Board, having considered all aspects of the Proposed Share Buy-Back, is of the opinion that the Proposed Share Buy-Back is in the best interest of our Company. Accordingly, your Board recommends that you vote in favour of the resolution pertaining to the Proposed Share Buy-Back to be tabled at the forthcoming AGM. This Statement is dated 28 August

14 Appendix THE NOTICE OF OUR THIRTEENTH AGM AND THE FORM OF PROXY ARE ENCLOSED IN OUR 2015 ANNUAL REPORT, WHICH IS SENT TOGETHER WITH THIS STATEMENT. THE FOLLOWING RESOLUTION IS EXTRACTED FROM THE SAID NOTICE. Ordinary Resolution 6 Proposed Renewal of Authority for the Purchase by the Company of its own ordinary shares of up to 10% of the issued and paid up share capital ( Share Buy-Back ) THAT, subject to the approval of the relevant authorities, approval be and is hereby given for the Company to acquire its own ordinary shares of RM0.10 each of up to 10% of its issued and paid up share capital ( Symphony ) from the market of Bursa Malaysia Securities Berhad ( Bursa Securities ), as may be determined by the Directors of the Company from time to time, in the manner set out in Section 2 of the Statement to Shareholders dated 28 August 2015 ( Statement ). THAT such authority shall commence upon the passing of this resolution and shall continue to be in force until: i the conclusion of the next Annual General Meeting at which time the authority will lapse, unless by an ordinary resolution passed at the next Annual General Meeting, the authority is renewed; or ii the expiration of the period within which the next Annual General Meeting after that date is required by law to be ; or iii revoked or varied by an ordinary resolution of the Company s shareholders in a general meeting, whichever occurs the earliest, but not so as to prejudice the completion of purchase(s) by the Company before the aforesaid expiry date. THAT the Directors of the Company be and are hereby authorised to take all such steps and do all acts and deeds and to execute, sign and deliver on behalf of the Company, all necessary documents to give full effect to and for the purpose of completing or implementing the Share Buy-Back in the manner set out in Section 2 of the Statement, which would include the maximum funds to be allocated by the Company for this purpose. AND THAT following completion of the Share Buy-Back, the Directors be and are empowered to cancel or retain as treasury shares, any or all of the Symphony so purchased, resell on Bursa Securities or distribute as dividends to the Company s shareholders or subsequently cancel, any or all of the treasury shares, with full power to assent to any condition, revaluation, modification, variation and/or amendment in any manner as may be required by any relevant authority or otherwise as they deem fit in the best interests of the Company. 11