KEuro seeks to retain majority interest in Talam

PETALING JAYA: Kumpulan Europlus Bhd's (KEuro) recent selldown of a 5.21% stake in Talam Corp Bhd, which reduced its holding in Talam to about 24%, is to raise fund to pay for financial instruments issued by Talam that KEuro has bought from Abrar Discounts Bhd (Abrar).

At an EGM on Nov 4 last year, KEuro shareholders approved the proposed acquisition from Abrar of financial instruments issued by Talam with total par/nominal value of RM423.35mil for a total purchase price of RM125mil.

A KEuro spokesperson said the company was expected to fully settle to Abrar the outstanding sum by this year. “Once we managed to achieve that, we expect the group's shareholding in Talam to creep back to above 30%.

“We have the intention to retain our majority interest in Talam because we see potential in the company when it assumes its business as a township developer in the Klang Valley,” he told StarBiz yesterday.

Talam has been classified under Practice Note 17 (PN17) on Sept 1, 2006, after its auditors failed to provide an opinion on its results for its financial year ended Jan 31, 2006. The company had also defaulted on term loans and bond obligations.

The developer partially completed its debt restructuring in July last year. The exercise was effectively divided into three parts - a capital reduction and a share split, the issuance of new convertible instruments to address certain defaulted debts, and a proposed asset divestment programme.

As at Jan 31, 2009, Talam's debts stood at some RM666.57mil, of which 78% or RM522.46mil are sukuk, Al Bai' Bithaman Ajil Islamic debt securities and bridging loans.

Its proposed regularisation plan has been delayed by prolonged negotiations on assets disposal.

A Talam official said due to the great effort by the management, the company had divested more than RM800mil of its properties, mainly land, including about RM670mil that was committed to be sold to Menteri Besar Selangor Inc to settle its total debts of RM392mil. The balance will be used to repay debts due to financial institutions.

On April 30, Talam made a submission to Bursa Malaysia to have it uplifted from PN17 and Bursa had requested for further furnishing of documents. Talam and its adviser, RHB Investment Bank Bhd, are collating the necessary documents as requested by Bursa and expect this to be done by early June.

The official said once the documents were in place, the company was hopeful of getting Bursa's approval soon. “There are plans to turn around Talam and allow the company to start on a clean slate to move on with its project development plans.”

He said the company's audited results were expected to be announced next week.

By the Star