MMC Corporation Berhad (KLSE:MMCCORP) entered into a conditional share sale and purchase agreement to acquire 70% stake in KMB Seaport Sdn Bhd from Seaport Terminal (Johor) Sdn Bhd for MYR 21 million on January 13, 2017. As per terms, MMC Corporation will acquire 7,000 shares of KMB Seaport, representing 70% ordinary equity interest, and 4.99 million irredeemable convertible cumulative preference shares. Out of MYR 21 million, MYR 2.1 million will be paid within one week after the execution of the agreement as a refundable deposit and part payment of the purchase consideration. The balance sum of MYR 18.9 million is to be paid by MMC Corporation upon completion of the agreement. The transaction will be funded by internal generated funds. KMB Seaport Sdn Bhd reported revenues of MYR 1.2 million, net profit of MYR 0.35 million and shareholder’s fund of MYR 5.3 million in 2016. The transaction is subject to approval by Government of Malaysia and approval by the Board and the shareholder of Seaport Terminal. The transaction is expected to be completed by July 2017. On July 12, 2017, MMC Corporation and Seaport mutually agreed to extend the period to satisfy or waive the conditions precedent in the agreement, by a period of 6 months commencing from July 13, 2017. It is also expected that the transaction would contribute positively to the future earnings of MMC Corporation. The transaction will not have any effect on the issued and paid-up share capital and the shareholdings of substantial shareholders of MMC Corporation. The transaction will not have any material effect on the earnings and earnings per share of the MMC Corporation for the financial year ending December 31, 2017. The transaction is expected to result in higher contribution from KMB Seaport to the future earnings of the MMC Corporation as the financial results of KMB Seaport will be consolidated into MMC Corporation’s financial results. The transaction is not expected to have any material effect on the audited consolidated net assets, net assets per share and gearing of MMC Corporation. Grant Thornton Consulting Sdn Bhd acted as a valuer of this transaction.