The Catalist-listed funeral services provider Asia-Pacific Strategic Investments Ltd (Apsil) said yesterday that it was moving "decisively" into the real estate agency business in an effort to diversify and eventually divest itself of its current loss-making business.
The Malaysian company announced that it will be acquiring Global Alliance Property (GAP) for $2.75 million. The target company was recently formed from the merger of two local players, Global Property Strategic Alliance and More Property, which have a combined base of about 800 real estate agents.
"This proposed acquisition will help to kick-start the new core business that we are looking to build, as we prepare to divest (ourselves of) our current loss-making bereavement care services," Apsil chief executive Choo Yeow Ming said.
"We remain committed to revitalising Apsil and enhancing shareholder value, and bringing the group back onto a sustained path of profitability and growth."
Apsil said the purchase amount will be payable in two tranches, in cash of $1.25 million and in shares worth $1.5 million, of which the latter part will be within two months after the completion of the acquisition of GAP.
This proposed acquisition will help to kick-start the new core business... as we prepare to divest (ourselves of) our current loss-making bereavement care services.
APSIL CHIEF CHOO YEOW MING
To help fund its push into a new core business, Apsil has proposed a rights-cum-warrants issue consisting of up to 3.37 billion new ordinary shares with 3.37 billion warrants, to raise up to $16.9 million.
In addition, the group expects to raise a further RM10.7 million (S$3.9 million) through its proposed divestment of HMS Capital, which owns its bereavement care services business.
Apsil made two earlier moves into the real estate agency business. The first was a proposal to acquire 100 per cent of Century 21 Hong Kong, a sub-franchiser that grants the Century 21 franchise to licensed real estate brokers in Hong Kong and Macau. When completed, this acquisition will give Apsil access to Century 21's marketing and operating systems, as well as its retail networks.
Apsil also agreed to partner China Real Estate Development Union Group Limited and the Oei Hong Leong Foundation to jointly develop an online property transaction platform for overseas Chinese investors and enterprises.
"Together with our joint-venture partners, we believe we can quickly develop and roll out a unique and scalable online platform that will effectively service the needs of affluent Chinese property investors around the world," said Dr Choo.
Before announcing this latest proposal, Apsil said in an Singapore Exchange filing in June that it was still in the midst of a $500 million reverse takeover deal involving Armenian miner Coeur Gold Armenia, but needed more time. The deal was inked last year and was supposed to be completed within four months. Apsil shares were flat yesterday, closing at 3.7 cents.