1. No category

KINSTEEL BERHAD (“KINSTEEL” OR “COMPANY”)
MEMORANDUM OF AGREEMENT BETWEEN KINSTEEL, PERFECT CHANNEL SDN BHD,
VIBRANT HOLDINGS SDN BHD AND BEIJING INDUSTRIAL DESIGNING AND
RESEARCHING INSTITUTE OF CHINA (“MOA”)
Unless otherwise defined in this announcement, all terms used herein shall have the same meaning as
those defined in the announcement dated 12 February 2015.
Further to the announcement made on 12 February 2015 in relation to the MOA, the Board of Kinsteel
wishes to announce the following additional information in relation to the MOA:
1.
INTRODUCTION
The Board wishes to clarify that Kinsteel proposes to develop new investment plans for the
Group’s businesses, which include installation of a new blast furnace and related downstream
manufacturing facilities and infrastructural work to upgrade and enhance the capacity of the
manufacturing operation at PCSB’s plant located at Gurun, Kedah Darul Aman (“Enhancement
Project”).
The MOA was entered into with Vibrant and BIDR for Vibrant and BIDR to explore the possibility
of Vibrant and BIDR undertaking the contract work for the Enhancement Project via the
installation of a new blast furnace and related downstream manufacturing facilities and
infrastructural work PCSB’s plant.
The purchase consideration payable to Vibrant and BIDR for the contract work to be undertaken
pursuant to the Enhancement Project will be satisfied by Kinsteel and PCSB partially in the form
of new shares to be issued by Kinsteel and the remaining balance to be paid by PCSB on deferred
payment terms / suppliers credit to be agreed upon between the parties.
2.
SALIENT TERMS OF THE MOA
2.1
Turnkey Contractor’s Proposal
The Turnkey Contractor, ie Vibrant and BIDR, have submitted a proposal to Kinsteel to provide
and install the new blast furnace and related downstream manufacturing facilities and
infrastructural work to PCSB pursuant to the Enhancement Project for an estimated amount of
RM200 million.
2.4
Manner of Payment
The payment terms for the supply and installation of the new blast furnace and other related
facilities and infrastructural work is to be negotiated and agreed upon in the definitive agreement
to be executed between the Company and the Turnkey Contractor.
3.
BACKGROUND INFORMATION
The directors and shareholders of Vibrant are Dato’ Yan Meng Jie and Yan Biao.
BIDR is a state-owned enterprise and is managed by the People’s Republic of China’s State
Owned Assets Supervision and Administration Commission of the State Council. The legal
representative of BIDR is Shen An Dong.
This announcement is dated 16 February 2015.