We refer to the Company's announcement made on 27 June 2024 (“Announcement”) in relation to the proposed disposal of 85% equity interest in Cipta X Sdn Bhd (formerly known as CSH Solutions Sdn Bhd) (“Cipta X”) (“Proposed Disposal”).

Unless otherwise stated, defined terms used in this announcement shall carry the same meanings as defined in the Announcement.

The Company wishes to provide the following additional information:

1. Estimated breakdown of the utilisation of proceeds allocated to the Company's business segments.

Based on the best estimate by the Management at this juncture, the Company is expected to utilise the proceeds from the Proposed Disposal as per table below:

Utilisation of proceeds

Note

RM

Percentage

Financial services business

(i)

10,000,000

50%

Transportation and logistics business

(ii)

5,000,000

25%

Working capital

(iii)

3,000,000

15%

Future prospective projects and/or acquisitions

(iv)

2,000,000

10%

Total

20,000,000

100%

Notes:
(i) To fund the Group’s financial service business (i.e., moneylending business) for loans disbursement purposes.

(ii) To fund the working capital requirements for the Group’s transportation and logistics business such as staff costs, rental or purchase of trucks, outsourced haulage and transportation costs, fuel expenses, toll fees, vehicle maintenance costs, warehousing costs, information technology expenses, marketing expenses and any other expenses required to support the Group’s transportation and logistics business as well as to fund for any future business expansions to be undertaken by the Group such as cost of potential collaboration/partnership with and/or acquisition of other transportation and logistics companies.

(iii) To fund the working capital requirements for the Group’s other existing businesses which include ceramic, construction and property businesses as well as the Group’s general administrative and other operating expenses such as staff related costs, office expenses, utilities expenses, rental expenses, professional fees and any other expenses required to support all the on-going business operations of the Group.

(iv) To fund for any future prospective business, project and/or acquisition to be identified by the Group as and when the opportunities arise.

Any surplus or shortfall for any category will be adjusted against one or more other categories depending on the funding requirements of the Group at any relevant time;


2. Rationale for the Company to engage in future businesses, given that the Company is involved in several businesses.

Velocity’s primary focus is to channel resources into expanding its business within existing sectors, particularly aiming to broaden its market and customer base in financial services by targeting a wider array of clients, including corporate customers seeking funding for corporate fund raising, mergers and acquisition. This could potentially enhance the customer portfolio and loan base and in turn contributing positively to the Group’s performance.

Moreover, the Group can also expand its transportation and logistics segments by capitalising on new growth opportunities, enhancing operational scope, and strengthening market penetration. This strategic focus aligns with Velocity's commitment to exploring and capitalising on future business opportunities across its diversified portfolio.         


This announcement is dated 28 June 2024.