Bursa Announcements

Date : 20 September 2013

OTHERS AEON CO. (M) BHD. ("the Company" or “AEON CO.”) - JOINT VENTURE AGREEMENT ENTERED INTO BETWEEN AEON CO. AND INDEX LIVING MALL COMPANY LIMITED

AEON CO. (M) BHD

TypeAnnouncement
SubjectOTHERS
DescriptionAEON CO. (M) BHD. ("the Company" or “AEON CO.”)
- JOINT VENTURE AGREEMENT ENTERED INTO BETWEEN AEON CO. AND INDEX LIVING MALL COMPANY LIMITED
1. INTRODUCTION
      The Board of Directors of the Company (hereinafter referred to as the “Board”) wishes to announce that the Company has on 20 September 2013 entered into a Joint Venture Agreement (hereinafter referred to as the “Agreement”) with Index Living Mall Company Limited (hereinafter referred to as the “ILM”) to jointly incorporate and register a private limited company in Malaysia in the name of “AEON INDEX LIVING SDN. BHD.” to engage in a business as furniture retailer who provides complete selections of unique-designed and high quality of home or office furniture and various home fashion products accessories and related services under one-stop shopping centre in Malaysia (the “Business”) (“Proposed Subscription”).

2. INFORMATION ON ILM
      ILM is a limited company incorporated in Thailand with its registered office located at 147 Soi Rama 2 Soi 50, Rama 2 Road, Samaedam, Bangkunthien, Bangkok 10150, Thailand, a Thailand-based furniture retailer who develops and owns a proprietary system relating to the operation of the business as home furnishings store for furniture and home decorative items and such business is carried on under the trade names/trademarks of “INDEX LIVING MALL”.

      The authorised share capital of ILM is 2,000,000,000 Baht comprising 20,000,000 ordinary shares of 100 Baht each and an issued and paid-up share capital of 2,000,000,000 Baht comprising 20,000,000 ordinary shares of 100 Baht each.


3. SALIENT FEATURES OF THE AGREEMENT

3.1 The Company and ILM will jointly incorporate and register a private limited company in Malaysia namely AEON INDEX LIVING SDN. BHD. (the “JV Company”) pursuant to the Agreement to carry out the Business and the Agreement shall subject to the fulfillment of the following conditions precedent (hereinafter referred to as the “Condition Precedent”) on or before the end of June 2014 (hereinafter referred to as the “Conditional Period”) or such other extension of time mutually agreed by the Company and ILM:
      (a) the approval of the Board of Directors of AEON CO. and ILM, if required;
      (b) the approval of the shareholders of the AEON CO. and ILM at the annual general meeting or the extraordinary general meeting to be convened, if required;
      (c) the approval of the Ministry of Domestic Trade Cooperatives and Consumerism for the execution of the Joint Venture Agreement and to operate the joint venture Business, if required;
      (d) the approval by the AEON CO. and ILM on the draft Memorandum and Articles of Associations for the JV Co;
      (e) the approval by the AEON CO. and ILM on the draft License Agreement (1), License Agreement (2);
      (f) such other relevant approval required by the Relevant Authorities for this incorporation.
3.2 The JV Company name shall be “AEON INDEX LIVING SDN. BHD.” and the shop name shall be “INDEX LIVING MALL” or such other names as both parties mutually agreed upon.

3.3 The authorised share capital of JV Company shall be RM50,000,000.00 divided into 50,000,000 ordinary shares of RM1.00 each and paid up share capital shall be RM45,000,000.00 divided into 45,000,000 ordinary shares of RM1.00 each (hereinafter referred to as the “Paid-Up Capital”).

3.4 The amount to be paid by each of AEON CO. and ILM in relation to the Paid-Up Capital according to the investment ratio is as follows (“Investment Ratio”):

Shareholders
Investment Ratio (%)
Amount to be Paid (RM)
AEON CO.
70%
31,500,000.00
ILM
30%
13,500,000.00


4. SOURCE OF FUNDING


      The Proposed Subscription will be funded from internally generated funds.


5. RATIONALE OF THE PROPOSED SUBSCRIPTION
      The Proposed Subscription is in line with the Company’s corporate strategy of accelerating the expansion of its business.

6. THE EXPECTED GAINS OR LOSSES ARISING FROM THE PROPOSED SUBSCRIPTION

      The Proposed Subscription is not expected to give rise to any material gains or losses on the earnings of the Company for the current financial year ending 31 December 2013.
7. ASSUMPTION OF LIABILITIES FOR THE PROPOSED SUBSCRIPTION

The Proposed Subscription will not have any effect on the liabilities of the Company.
    8. EFFECT OF THE PROPOSED SUBSCRIPTION

    8.1 Share Capital and Substantial Shareholders’ Shareholdings
          The Proposed Subscription will not have any effect on the share capital of the Company or the shareholdings of substantial shareholders.

      8.2 Earnings and Net Assets

          The Proposed Subscription is not expected to have any material impact on the earnings and net assets per share of the Company for the financial year ending 31 December 2013.

      8.3 Gearing
            The Proposed Subscription does not have any gearing impact on the Company.


        9. DIRECTORS AND MAJOR SHAREHOLDERS’ INTEREST
            None of the Directors and/or major shareholders of the Company and/or persons connected to them has any interest, direct or indirect, in relation to the Proposed Subscription.


        10. STATEMENT BY THE BOARD OF DIRECTORS
            Having considered the rationale and effects of the Proposed Subscription, the Board is of the opinion that the Proposed Subscription is in the best interest of the Company.

        11. PROSPECT
              The Proposed Subscription of seventy percent (70%) equity shares in JV Company will enable the Company to participate in the Business for synergistic benefits and further allow the Company to continue to enjoy and share in the potential future returns generated by the JV Company.
            12. RISK FACTOR
                Apart from the ordinary business risks, there are no other additional risks envisaged that may arise from the Proposed Subscription.


            13. APPROVALS REQUIRED
                The necessary approvals for the Proposed Subscription is as stated in item 3 above and the Proposed Subscription does not require the approval of the shareholders of the Company.
            14. ESTIMATED TIMEFRAME FOR COMPLETION
                Barring unforeseen circumstances and fulfillment of all terms and conditions precedent, the Proposed Subscription is expected to be completed on or before the end of June 2014 or such other extension of time mutually agreed by AEON CO. and ILM.

            15. DOCUMENTS FOR INSPECTION
                A copy of the Agreement dated 20 September 2013 is available for inspection at the registered office of AEON at 3rd Floor, Jusco Taman Maluri Shopping Centre, Jalan Jejaka, Taman Maluri, Cheras, 55100 Kuala Lumpur during normal office hours from Monday to Friday (except public holidays) for a period of three (3) months from the date of this announcement.
            This announcement is dated 20 September 2013.


            Announcement Info

            Company NameAEON CO. (M) BHD  
            Stock Name AEON    
            Date Announced20 Sept 2013  
            CategoryGeneral Announcement
            Reference NoCC-130918-44832

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