Malaysian construction group Southern Score Builders has entered into a conditional shares sale and purchase agreement with Ngo Hea Bing (NHB) to acquire a 51% stake in electrical contractor SJEE Engineering.
The proposed acquisition has a total cash consideration of RM22.95m ($4.86m).
Southern Score will pay approximately RM5.655m directly to NHB, with the remaining RM15m to be held as a security sum for the profit guarantee.
The agreement stipulates that Southern Score will purchase 1.27 million shares from NHB, the current whole owner of SJEE.
It also includes a profit guarantee from NHB, ensuring SJEE will achieve a cumulative net profit of at least RM15m over the next three financial years until 30 June 2027.
Southern Score, known for its construction management services, engages subcontractors for various works, including mechanical and electrical engineering and internal infrastructure.
The company’s construction portfolio includes various residential buildings located in the Klang Valley area in Malaysia.
The move is anticipated to expand Southern Score's geographical reach beyond Klang Valley, tapping into SJEE's existing projects across the country.
Southern Score's board believes that the acquisition will contribute positively to its financial performance, especially with the profit guarantee in place for the coming years.
