GFM agrees to share sale deal with Kumpulan Parabena

KUALA LUMPUR: Integrated facilities management services provider GFM Services Bhd has entered into a share sale agreement with Kumpulan Parabena Sdn Bhd to acquire a 100% stake in concession holder, KP Mukah Development Sdn Bhd (KP Mukah) for RM130mil.

KP Mukah holds a concession, awarded by the Malaysian government and Universiti Teknologi Mara, which entails the design, build and construction of UiTM Mukah campus in Sarawak and the delivery of facilities management services. The concession period is for a tenure of 23 years from September 2012 until September 2035, a statement from GFM Services said.

Since the completion of construction in 2015, KP Mukah has been collecting lease rental, asset maintenance and management charges from UiTM. The campus which can accommodate up to 2,000 students, covers an area of approximately 64 acres.

GFM managing director Ruslan Nordin said growth via mergers and acquisition is the company’s growth plans. This is the company’s maiden purchase since its January 2017 listing on the ACE Market.

He said the purchase is complementary and synergistic to GFM’s core business.

“We are moving up the value chain by enlarging our scope from merely being a service provider of integrated facility management services into a full-scale build, lease and transfer concession holder,” Ruslan said.

“The acquisition will boost our orderbook to about RM1.5bil in total, generating a new stream of stable cash flow that ensures longterm earnings visibility. By acquiring KP Mukah, GFM gains direct access to the concession and is entitled to its future cash flow and earnings, hence positively enhancing GFM’s income,” he said.

The acquisition will be funded by a combination of internal funds, equity financing and borrowings. As at Sept 30, 2017, GFM is in a net cash position and has ample room to gear up to fund this acquisition.