KUALA LUMPUR (Jan 10): Tex Cycle Technology (M) Bhd has proposed to dispose of two detached factories in Puchong for RM19 million, noting that they have increased in value since their acquisition in 2004.

“The proposed disposal is expected to result in a gain on disposal of approximately RM13.72 million,” the group said in a Bursa Malaysia filing.

The group is selling the two-storey and one-and-half-storey factories, located on leasehold land in Taman Perindustrian Kinrara, to Sedaya Rasmi (M) Sdn Bhd.

The total land area of the properties — which are used as storage facilities — is 4,088.63 sq metres, said Tex Cycle.

It added that proceeds from the disposal would be used for general working capital requirements in respect of its day-to-day operations to support its existing business operations.

These include the payment of staff costs, payment to suppliers, monthly overhead expenses, rental, utilities, as well as current and future investments in the pipeline.

“The actual breakdown of these expenses and the timeframe for full utilisation of the proceeds cannot be determined at this juncture, as it will depend on the actual working capital requirements of the company at the relevant time,” Tex Cycle said.

The group expects the disposal to be completed in three months.

On Tuesday (Jan 10), Tex Cycle’s share price was up 19 sen or 43.68% at 62.5 sen — the highest since Jan 6, 2022, when it closed at 59.6 sen.

At the current price, the group has a market capitalisation of RM158.21 million.

Source: EdgeProp, 11 January 2023.