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PETALING JAYA (July 23): OCR Group Bhd has entered into a conditional share sale agreement to acquire a 49% equity interest in Chester Properties Sdn Bhd from Datuk Howard Chew Si Hoo for RM19.6 million, to be satisfied entirely through the issuance of 478.05 million new ordinary shares at an issue price of 4.1 sen each.
It said in a Bursa Malaysia filing on Tuesday (July 22) that the proposed acquisition involves 245,000 ordinary shares in Chester Properties. Upon completion, Chester Properties will become a 49%-owned associate of OCR.
The purchase consideration implies an equity valuation of RM40 million for Chester Properties, which OCR said falls within the RM33.73 million to RM40.09 million valuation range determined by BDO Capital Consultants Sdn Bhd using the discounted cash flow method as at March 31, 2026.
Under the share sale agreement, the vendor has provided a profit guarantee requiring Chester Properties to achieve an aggregate audited profit after tax (PAT) of at least RM13.65 million over the financial years ending Dec 31, 2026 to Dec 31, 2029, with annual PAT targets ranging from RM3.3 million to RM3.55 million.
Chester Properties operates a property agency business with 11 branches across Malaysia. The company has a network of more than 4,000 real estate agents and is engaged in marketing more than 32 property development projects.
As security for the profit guarantee, all 478.05 million consideration shares will be subject to a lock-up arrangement until the aggregate profit target is achieved or any shortfall is made good by the vendor in accordance with the agreement.
OCR said funding the acquisition entirely through the issuance of new shares will preserve the group’s cash reserves for working capital, capital expenditure and future acquisition or joint venture opportunities.
The company had earlier announced the proposed acquisition under a heads of agreement in March 2026. The parties subsequently extended the agreement until Aug 4, 2026 before entering into the conditional share sale agreement on July 22.
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