Thursday, September 23, 2010

Support ... Sep10


It is looking to diversify and hopes within the next three years to derive a significant portion of its revenue from property and e-commerce services.

Currently, 60% of its revenue comes from the manufacturing of plastic and wooden audio speaker systems for MNCs.

It already has an ongoing residential property development project in Penang via its wholly owned subsidiary Welcome Properties Sdn Bhd.

Supportive acquired Welcome Properties from its major shareholders and founder, Datuk Seri Lee, for RM10 million. Lee, who holds a 66.5% stake in Supportive Intl, is also the executive chairman.

Supportive Intl is in the process of placing out 20% of its currently issued 218 million shares to an alternative investment group, GEM Investment Advisors Inc.

This exercise, which is expected to be completed in Oct 2010 will see Lee’s interest in Supportive diluted to 54.78% of the enlarged capital. The private placement will net the company RM120 million, which will bolster its current cash position of about RM20 million.

It will use half of the cash for its upcoming property and IT software development projects overseas.

The private place comes together with 35 million detachable warrants to be issued to GEM’s Global Yield Fund. The conversion price of the five year warrants has been set at RM1.90. If the warrants are converted, it will net Supportive Intl an additional RM66.5 million.

Welcome Properties is also looking to increase its landbank in strategic locations to launch more projects locally and overseas.

By 2011, the revenue contribution from its property arm will be about the same as that from its manufacturing arm.

It also has properties development in Australia.

The company is also in the process of finalizing a JV agreement with China Telecom and Bank Of ChanSa to develop software systems.

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