THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the course of action to be taken, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, 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 Circular. (Company No. 3871-H) (Incorporated in Malaysia under the Companies Act, 1965) PART A CIRCULAR TO SHAREHOLDERS IN RELATION TO THE PROPOSED DISPOSAL BY BAKTI WIRA DEVELOPMENT SDN BHD, A WHOLLY OWNED SUBSIDIARY OF BOUSTEAD HOLDINGS BERHAD ( BHB ), OF ITS 30% EQUITY INTEREST HELD IN JENDELA HIKMAT SDN BHD TO CASCARA SDN BHD FOR A CASH CONSIDERATION OF RM180 MILLION ( PROPOSED DISPOSAL ) PART B INDEPENDENT ADVICE LETTER FROM MAINSTREET ADVISERS SDN BHD TO THE NON-INTERESTED SHAREHOLDERS OF BHB IN RELATION TO THE PROPOSED DISPOSAL AND NOTICE OF EXTRAORDINARY GENERAL MEETING Principal Adviser Independent Adviser AFFIN HWANG INVESTMENT BANK BERHAD (Company No. 14389-U) (A Participating Organisation of Bursa Malaysia Securities Berhad) MAINSTREET ADVISERS SDN BHD (Company No. 790320-P) The notice of the Extraordinary General Meeting ( EGM ) and the Proxy Form are enclosed in this Circular. Details of our EGM: Date and time : Friday, 29 April 2016 at 3:30 p.m. or at any adjournment thereof. Venue : The Royale Ballroom, Level 2, The Royale Bintang Kuala Lumpur, 17-21, Jalan Bukit Bintang, 55100 Kuala Lumpur. Details of lodging the Proxy Form: Last date and time for lodgment : Wednesday, 27 April 2016 at 3:30 p.m. or not less than 48 hours before the time appointed for our EGM or at any adjournment thereof. To be deposited at our Share Registrar s registered office : Tricor Investor & Issuing House Services Sdn Bhd located at Unit 32-01, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur. This Circular is dated 15 April 2016
(2) After taking into consideration the estimated net gain of approximately RM198.4 million arising from the Proposed Disposal, computed as follows: RM million Sale Consideration 180.0 Less: (i) Cost of investment of BWSB in JHSB (12.6) (ii) Impairment of goodwill (9.7) Add: (i) Share of losses of JHSB recognised up to the FYE 31 December 52.0 2015 (being BWSB s proportionate share of losses in JHSB since 6 July 2007*) (ii) Share of pre-acquisition reserves ^ 1.5 Gain on disposal (before tax and expenses) 211.2 Less: Estimated tax and expenses (12.8) Net gain on disposal 198.4 * The date of the completion of the acquisition of BWSB by Mutiara Rini Sdn Bhd (a wholly-owned subsidiary of our Company). ^ Being the reversal of our share of losses in JHSB, which was recognised by BWSB prior to the completion of the acquisition of BWSB by Mutiara Rini Sdn Bhd on 6 July 2007. (3) Assuming the repayment of RM0.9 million in bank borrowings as part of the utilisation of disposal consideration from the JCB Property and Assets Disposal (4) Gearing is calculated as total borrowings divided by shareholders equity. 5.3 Earnings and EPS The Proposed Disposal is not expected to have any material effect on the earnings of our Group for the financial year ending 31 December 2016. Upon completion of the Proposed Disposal, our Company is expected to realise an estimated gain of approximately RM198.4 million (net of taxation and estimated expenses), which translates into a gain of approximately 19 sen per BHB Share for the FYE 31 December 2016. The actual gain arising from the Proposed Disposal will depend on, amongst others, the actual amount of tax and expenses to be incurred in relation to the Proposed Disposal. For illustration purposes, the pro forma effects of the Proposed Disposal on the earnings of our Group assuming that the Proposed Disposal was completed on 1 January 2015, being the beginning of the FYE 31 December 2015, are set out below: PAT attributable to owners of our Company Number of ordinary shares in issue ( million) Audited for the FYE 31 December 2015 (I) After the JCB Property and Assets Disposal After (I) and the Proposed Disposal RM million RM million RM million 13.2 (1) 17.9 (1) 216.3 1,034.2 1,034.2 1,034.2 Earnings per share (sen) 1.28 1.73 20.91 Note: (1) After taking into consideration the net gain of RM4.7 million arising from the JCB Property and Assets Disposal, which was completed on 6 April 2016 and the estimated net gain of RM198.4 million arising from the Proposed Disposal. For the FYE 31 December 2015, JHSB contributed a share of loss of approximately RM10.4 million towards our Group s PAT. 15