| Type | Announcement | ||||
| Subject | ANNOUNCEMENT ON RECURRENT RELATED PARTY TRANSACTION | ||||
| Contents | Rimbunan Sawit Berhad (“RSB” or “the Company”) wishes to announce on the recurrent related party transaction of a revenue and/or trading nature (“RRPT”) entered into between RSB Group and a related party. |
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Introduction
RSB wishes to announce on the following RRPT entered into between RSB Group and RH Lundu Palm Oil Mill Sdn. Bhd. (“RHLPOM”) :-
The above amount of which by way of aggregation, have exceeded the prescribed limit of RM1 million in respect of recurrent transactions entered into as at 30 September 2010. Nature of RRPT The RRPT entered into by RSB Group is in the ordinary course of business. It is a recurring transaction of a revenue and/or a trading nature which was occurred with some degree of frequency and arise at any time and from time to time. This RRPT may be constrained by the time-sensitive nature and confidentiality of such transaction made on an arm's length basis and on normal commercial terms not prejudicial to the interest of the shareholders and not more favourable to RHLPOM those generally available to the public and is not detrimental to the minority shareholders. Rationale of RRPT The rationale for RSB Group to enter into the RRPT is to take advantage of efficiencies in business dealings, in particular competitive prices, shorter delivery time and reliability in source of materials, goods and services. The RRPT met the business needs of RSB Group at the best possible terms. By transacting with the RHLPOM, RSB Group would have an advantage of familiarity with the background, financial well-being and management of RHLPOM, thus enabling more informed commercial decisions to be made. In dealings with RHLPOM, RSB Group and RHLPOM have a good understanding of each other’s business needs thus providing a platform where all parties can benefit from conducting the RRPT. These would ultimately benefit the RSB Group and the shareholders by enhancing profitability and returns on shareholders’ funds. Effect of RRPT on RSB Group The RRPT is not expected to have any significant effect on the earnings per share, net assets per share, gearing, share capital and substantial shareholders’ shareholding of RSB Group. The nature and extent of the interests of the interested directors and major shareholders Tan Sri Datuk Sir Diong Hiew King @ Tiong Hiew King, the director and major shareholder of RSB, is also a director and shareholder of RHLPOM, by virtue of his substantial equity interests in RHLPOM. Mr. Tiong Chiong Ong, the director of RSB, is also a shareholder of RHLPOM. Teck Sing Lik Enterprise Sdn Bhd, Tiong Toh Siong Enterprises Sdn. Bhd. and Tiong Toh Siong Holdings Sdn. Bhd., the major shareholders of RSB, are also shareholders of RHLPOM by virtue of their substantial equity interests in RHLPOM. Messrs. Tiong Kiong King, Tiong Chiong Ong and Tiong Chiong Ie are the Directors of RSB. They are deemed interested in the transaction by virtue of their family relationships with Tan Sri Datuk Sir Diong Hiew King @ Tiong Hiew King. Whether the RRPT is subject to the approval of shareholders and the relevant government authorities The RRPT is not subject to the approval of shareholders and the relevant government authorities. Statement by Directors The directors, saved for Tan Sri Datuk Sir Diong Hiew King @ Tiong Hiew King, Tiong Kiong King, Tiong Chiong Ong and Tiong Chiong Ie, having considered all aspects of the RRPT, are in the opinion that the RRPT is in the best interests of the Company and not detrimental to the interests of the minority shareholders. Statement by Audit Committee The Audit Committee having considered the rationale for the RRPT, is of the view that the RRPT is in the best interests of the Company, fair, reasonable and on normal commercial terms and not detrimental to the interests of the minority shareholders as the RRPT were entered into the ordinary course of business on normal commercial terms which are not more favourable to the related party than those generally available to the public. |
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| Company Name | RIMBUNAN SAWIT BERHAD |
| Stock Name | RSAWIT |
| Date Announced | 7 Oct 2010 |
| Category | General Announcement |
| Reference No | CCS-101007-0EF85 |