Bjcorp ... May12

It has proposed to raise its stake in Atland to 24.97% stake, making it the second largest shareholder in the latter. It now owns 9.18% stake in Atlan after it bought an additional 20 million shares or 7.9% stake at rm4.25 per share. BJcorp plans to buy further 15.8% stake in Atlan from Cipta Nirwana Sdn Bhd for rm170 million or rm4.25 pre share. This would eventually bump up its equity holding to 24.97% stake.

BJCorp plans to settle the purchase consideration by the issuance of five year 5% ICULS in BJcorp worth rm170 million. The ICULS will be accompanied by 170 million detachable warrants in BJCorp. These ICULS will be convertible into new BJCorp shares at the conversion price of rm1 for every one new BJCorp share. The issuance of the new ICULS and warrants would avoid any immediate cash outflow and allow BJCorp the time and flexibility to arrange for an orderly resolution of the put option. BJCorp has granted a put option to Cipta Nirwana that allows the latter to sell back the consideration shares to BJCorp.

It is not known who sold the 7.9% stake in Atland to BJcorp, Distinct Continent Sdn Bhd is currently Atland’s largest shareholder with a 50% stake.

Atlan is primarily involved in duty free trading and retailing, property development, hospitality and automotive parts manufacturer businesses.

Meanwhile BJCorp’s proposed acquisition of an associate stake in diversified entity could give the buyer access into prime tracts in Penang.

Atland owns prime freehold land in Penang’s north eastern enclave. These tracts have a combined area of 1.17 sq meters with a net book value of rm38 million.

BJcorp via subsidiary BJLand is making inroads into the Penang real estate market. BJLand made news in Aug 2011 when it acquired a 23ha portion of the Penang Turf Club tract for rm459 million.