FORMIS RESOURCES POISED TO TAKE ADVANTAGE OF
MORE OPPORTUNITIES IN THE ICT SECTOR
Shareholders approved its reverse takeover of ISS Consulting Solutions
KUALA LUMPUR, MONDAY (17 March 2010): Formis Resources Berhad (FRB) which received shareholders’ approval today for its reverse takeover (RTO) of leading SAP solutions provider, ISS Consulting Solutions Bhd (ISS), is now competitively poised to be a technology provider of world class standards with a regional presence.
Dato’ Mah Siew Kwok, Executive Vice Chairman and Chief Executive Officer of FRB said after the extraordinary general meeting of shareholders: “The enlarged FRB Group with enhanced technical capabilities and financial resources is strongly positioned to pursue more opportunities in the information and communication technology (ICT) sectors locally and regionally.
He said: “ICT is viewed by enterprise as a vital component for business efficiency and will continue to be a key enabler and strategic tool for cost savings and productivity improvements during challenging times.”
“In addition, with the initiatives and efforts undertaken by the Malaysian Government to boost the ICT sector, FRB, also sees tremendous opportunities for the ISS Group’s solution offerings, particularly from large private enterprise as well as the Government and government-linked companies,” he added.
The RTO of ISS is via the injection of FRB’s subsidiary Diversified Gateway Berhad (DGB) into ISS. The RTO is part of a corporate exercise approved by shareholders at the Company’s extraordinary general meeting today. The other part involves the proposed distribution in-specie of 185.9 million ISS shares pursuant to the proposed RTO, to FRB shareholders, on the basis of one ISS share for one FRB share. After the distribution in-specie, FRB will hold 59.3% of ISS.
Dato’ Mah added that the dilution of FRB’s holding in DGB is not expected to have a material impact on the future earnings of the FRB Group given its contract in hand amounting to approximately RM370 million as at 31 December 2009. In addition, FRB will still be able to consolidate the contribution from DGB via its 59.3% stake in ISS.
ISS, incorporated in 2004 by a group of highly experienced SAP consultants, is one of the leading service providers of integrated business solutions in the SAP environment. ISS has over the years, deployed state-of-the-art SAP solutions across various industries such as chemicals, automotive, manufacturing, and industrial machinery and components, in the ASEAN countries and the Asia Pacific.
Dato’ Mah said the sale of DGB and the takeover of ISS was in line with FRB’s vision of acquiring strategic businesses which would integrate, complement and value-add to the Group’s existing operations and enhance the Group’s value proposition to its clientele and shareholders.
He said FRB has been on the lookout for opportunities to enhance its SAP solutions business, an area in which the Company felt was the “missing link” in its suite of ICT solutions. The RTO gives FRB a meaningful presence in the SAP solutions segment immediately.
ISS would also provide the FRB Group with a platform to capitalize on the growth opportunities in Asia, given ISS’ growing presence and extensive customer base in Singapore, Thailand and Indonesia.
With regards to the dividend-in-specie, it is to reward FRB’s shareholders, and at the same time ensures that ISS complies with the public shareholding spread.
The proposed corporate exercise has received all the relevant approvals, except for Securities Commission’s approval for the Proposed Dividend-In-Specie and the Mandatory General Offer. The distribution of the Proposed Dividend-In-Specie will be implemented upon receipt of the approval from the relevant authorities and in compliance of all the conditions stated.