Ann Joo and Southern Steel plans for RM1.65b partnership

KUALA LUMPUR: Ann Joo Resources Bhd and Southern Steel Bhd have entered into a memorandum of understanding (MoU) to form a 55:45 joint venture company (JV co) to make and sell long steel products.

Ann Joo and Southern Steel will enter into definitive agreements to effect the proposal within 90 days from the MoU date.

This entails the proposed sale by Ann Joo of the entire equity interests in Ann Joo Integrated Steel Sdn Bhd, Ann Joo Steel Bhd and Saga Makmur Industri Sdn Bhd to the JV co for RM907.5 million.

It also entails the proposed sale by Southern Steel of the entire equity interests in Southern Steel Rod Sdn Bhd, Southern Steel Mesh Sdn Bhd, Southern PC Steel Sdn Bhd and Danstil Sdn Bhd, the business of manufacturing, sales and trading of steel billets and steel bars, and certain parcels of its land to the JV co for RM742.5 million.

“The proposals are intended to result in the JV co becoming a 55 per cent-subsidiary of Ann Joo and a 45 per cent-associated company of Southern Steel via the issuance of new shares in the JV co to Ann Joo and Southern Steel,“ Ann Joo and Southern Steel said in their filings to Bursa Malaysia.