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KUALA LUMPUR (September 10): Bus operator Gets Global Bhd says an estimated RM226 million, an amount that is twice its current market capitalization, is needed for its planned diversification into the bus manufacturing business. Gloves, which he said will be financed through a combination of bank loans and cash.
This comprises RM 100 million for the estimated construction cost of a glove manufacturing plant, and RM 126 million for the fabrication, installation and commissioning of 12 new dual-former glove dipping lines, he said today at a Stock exchange statement.
These 12-glove dip lines are estimated to be able to produce about 4.14 billion pieces of gloves per year, he said. Responded to inquiries from Bursa Malaysia regarding the plant construction costs and installation of the 12 glove dipping lines, and their expected production capacity.
To another question on the regulatory approvals required for the business, Gets Global said that it must submit relevant applications and obtain approvals from various authorities and regulatory bodies, including the Malaysian Rubber Board, and that such approvals are expected to be progressively obtained. through the second quarter of 2021.
He also said that he intends to export the gloves produced around the world, in particular to the United States, Europe and Japan, in addition to selling them locally. For overseas sales, he said it will be required to comply with the relevant device regulations of the respective countries it enters.
Gets Global first announced the new trading venture and the construction of the new plant on September 8, following the appearance of substantial new shareholder Teong Lian Aik, with a 31.87% stake, on August 25. In the weeks leading up to Teong’s emergence, Gets Global shares jumped from around 8 sen each to 24 sen. It then rose 30 sen to hit the 53.5 sen limit on August 26, prompting an unusual query for Bursa Malaysia market activity.
To finance the new company, Gets Global had also proposed the sale of 158 million new shares at 55 sen each to its main shareholder ADA Capital Investments Ltd, as well as Beh Boon Seong, Tan Chai Chek and Chua Choy Guan, who would raise RM86. 9 million.
ADA Capital is controlled by Teong’s brother-in-law, Low Bok Tek. Low is the founder of glove maker Latexx Partners Bhd, which was delisted by Bursa Malaysia in 2013.
Following the announcement of the new business, Gets Global shares soared yesterday to a record 93 sen each. Today, the shares fell 10.5 sen or 11.29% to close at 82.5 sen, after 72.72 million shares were traded, with a market capitalization of 103.95 million ringgit.
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