KUALA LUMPUR 12 Jan 2016 : Nexgram Holdings Berhard (Nexgram) plans to sell Godynamic Investment Limited (GIN) for RM34.8 million as part of group on-going merger & acquisition fund raising exercise.
In a filing with Bursa Malaysia this evening, it said that Nexgram has entered into a sales and purchase agreement (SPA) with foreign investors for the proposed disposal of GIN which is the foreign investment vehicle of the group for new technologies investments.
GIN is a 69.6%-owned subsidiary of Nextnation Network Sdn Bhd (NNSB), which in turn is a wholly-owned subsidiary of Nexgram. The company had bid on many government linked contracts oversea, and had last year won a data encryption contract from Indonesia.
The GIN investee came with a military grade mobile data encryption contract, which is the main consideration of GIN new investors, where the service users include (foreign) national security sensitive customers, military and political intelligence agencies. According to Market research firm Gartner, the worldwide cybersecurity market is defined by market sizing estimates that range from $75 billion in 2015 to $170 billion by 2020.
However, the group has recent years diversified into property development business, and the high capital expenditure in technology infrastructure may constrain the group cash flow in other businesses. Divesting lost making investment in exchange for assets with better prospect is part of the group corporate strategies.
The group plans to use the proceeds to fund investment and acquisitions within 12 months from the respective dates of receipt of the payment.
The transaction does not require shareholder or authority approvals, and any balance will be utilized for working capital of the group.
The proposed disposal, is expected to be completed within first quarter of 2016.
Nexgram Holdings Berhad (“Nexgram Group”) is a public listed multinational investment company based in Kuala Lumpur, Malaysia. As of to date, the group operates through the following segments: Telecommunication, Security & Surveillance, Software Development, Property Development, Industries, Business Advisories and Investment activities.