SINGAPORE - Home appliance maker Casa Holdings said it has entered into sale and purchase agreements with its substantial shareholders on Tuesday to dispose of shares in its unit, Fiamma Holdings Berhad (FHB), for RM24.42 million (S$8.1 million).

The purchase price of RM0.55 per share represents a premium of about RM0.045 to the last transacted price of RM0.505 on Dec 4, 2017, being the last full trading day prior to the signing of the agreements.

This comes as the firm seeks to raise funds to reduce their bank borrowings, and for the general working capital of the group.

Casa has entered into an agreement with FHB's director and substantial shareholder, Lim Choo Hong, to sell 16.4 million FHB shares for RM9.02 million.

A second agreement was established to sell 28 million shares to substantial shareholder Ngo Wee Bin for RM15.4 million.

As at Dec 6, 2017, Mr Lim and Mr Ngo hold 130.99 million shares and 56 million shares respectively, representing 25.75 per cent and 11.01 per cent of the issued and paid-up share capital of FHB.

Taken together, the sale shares represent about 8.73 per cent of FHB's issued and paid-up share capital. Upon completion of the proposed disposal, Casa will hold about 74.89 million ordinary shares of FHB, representing 14.72 per cent of FHB. Therefore, FHB will cease to be an associated company of Casa.

Assuming that the proposed disposal has been effected on Oct 1, 2016, being the beginning of FY2017, loss per share will be reduced from S$0.067 to S$0.065 after the disposal.

Completion of the agreements are conditional upon the fulfillment of various conditions, including approval from Casa's board of directors as well as the sale and purchase of shares being completed simultaneously.

FHB is a Malaysian-listed company engaged in the business of distributing home applicances and property investment in Malaysia.