1. INTRODUCTION

The Board of Directors (“the Board”) of M&G wishes to announce that on 31 July 2020, the Company has triggered the prescribed criteria pursuant to Paragraph 8.04 and Paragraph 2.1(a) of Practice Note 17 (“PN17”) of the Main Market Listing Requirements of Bursa Securities (“MMLR”) where M&G’s shareholders’ equity on a consolidated basis is less than 25% of the share capital and such shareholders’ equity is less than RM40 million. The ratio of M&G’s shareholders’ equity on a consolidated basis as at financial period ended 31 July 2020 is 9.7% and such shareholders’ equity is RM26.1 million.

2. BURSA RELIEF MEASURES

Bursa Securities had via its letter dated 16 April 2020 granted affected listed issuers relief from complying with the obligations under Paragraph 8.04 and PN17 of the MMLR (“PN17 Relief Measures”) from 17 April 2020 to 30 June 2021 (“Relief Period”). The PN17 Relief Measures will be available to the listed issuer if it triggers any one of the following criteria under PN17 of the MMLR (“Suspended Criteria”):-

1. The shareholders’ equity on a consolidated basis is 25% or less of its share capital (excluding treasury shares) and such shareholders’ equity is less than RM40 million;
2. The auditors have highlighted a material uncertainty relating to going concern or expressed a qualification on the listed issuer’s ability to continue as a going concern in its latest audited financial statement and its shareholders’ equity on a consolidated basis is 50% or less of its share capital (excluding treasury shares); and
3. Default in payment by the listed issuers, its major subsidiaries or major associated company, as the case may be, as announced pursuant to Paragraph 9.19A of the MMLR and the listed issuer is unable to provide a solvency declaration to the Exchange.

Under the PN17 Relief Measures:-

1. An affected listed issuer that triggers any of the Suspended Criteria during the Relief Period will not be classified as PN17 listed issuer and will not be required to comply with the obligations pursuant to Paragraph 8.04 and PN17 of the MMLR for a period of 12 months from the date of triggering the criteria;
2. The affected listed issuer will still be required to make an immediate announcement that it has triggered the Suspended Criteria and the relief provided (“Relief Announcement”);
3. Upon the expiry of the 12 months from the Relief Announcement, the affected listed issuer must re-access its condition and announce whether it continues to trigger any of the criteria in PN17 of the MMLR;
4. If the affected listed issuer continues to trigger any of its criteria of PN17 of the MMLR, it will then be classified as a PN17 listed issuers and must comply with all the obligations under Paragraph 8.04 and PN 17 of the MMLR, including the obligation to submit a regularization plan to the relevant authorities within 12 months of the said Announcement.

3. BACKGROUND AND STATUS AS AT TODATE

On 6 February 2018, Jasa Merin (Malaysia) Sdn. Bhd. (“Jasa Merin”), a subsidiary held through AQL Aman Sdn. Bhd. (“AQL”), received approval from the Corporate Debt Restructuring Committee of Bank Negara Malaysia for Jasa Merin’s application for assistance to mediate between Jasa Merin and its subsidiaries with their lenders (“Lenders”).

The Group has proposed a debt restructuring scheme (“PDRS”) to the respective Lenders which includes:

1. a 12-month moratorium on repayment of borrowings to the respective Lenders, commencing from the first drawdown date of the PDRS (“Moratorium”);
2. a RM50 million upfront proportionate cash payment to the Lenders (“Upfront Payment”);
3. partial settlement of the outstanding debts amounting to RM150 million via the issuance of irredeemable preference shares of RM1.00 each by Jasa Merin to the Lenders (“JMM PS”). The JMM PS in turn, may be presented and surrendered to the Company in exchange for new ordinary shares of the Company based on an exchange ratio of one (1) JMM PS for ten (10) new ordinary shares of the Company (“Share Exchange”); and
4. granting to Jasa Merin and its subsidiaries, namely JM Global 3 (Labuan) Plc and JM Global 4 (Labuan) Plc, additional time to settle the balance of RM728.3 million by way of term financings.

The Share Exchange was approved by the shareholders of the Company at an Extraordinary General Meeting held on 31 December 2019. Subsequently, Jasa Merin paid the Upfront Payment in January 2020, and completed all the Facility and Security agreements on 5 May 2020.

The PDRS was completed on 13 August 2020 following the issuance of RM150 million JMM PS to extinguish RM150 million of the existing debts to the Lenders and the drawdown of the remaining term financings on that date.

Following the completion of the PDRS, Jasa Merin has recognised RM106.8 million gain comprising gain on the restructuring of debts and gain from the issue of JMM PS to the Lenders.

Based on the financial position at 31 July 2020, the restructuring gain has resulted in increasing M&G’s shareholders’ equity from RM26.1 million to RM100.9 million. Please refer to the attachment for details of Proforma Consolidated Statements of Financial Position as at 31 July 2020.

4. CONCLUSION

In view of the above, M&G no longer triggers the prescribed criteria pursuant to Paragraph 8.04 and Paragraph 2.1(a) of PN17.

This announcement is dated 22 September 2020.