Formis Resources Bhd (FRB) and its wholly owned subsidiary Formis Holdings Bhd (collectively referred to as Formis) have
entered into a Heads of Agreement (HOA) to divest four subsidiary companies to Microlink Solutions Bhd (Micro) for RM102.0 million.

The proposed acquisition by Micro is for Formis' entire equity interest in Applied Business Systems Sdn Bhd, Formis Computer Services Sdn Bhd, Formis Systems and Technology Sdn Bhd and its entire 51 per cent interest in First Solution Sdn Bhd.

Formis, in a statement here today said under the HOA, the purchase consideration is to be satisfied by the issuance of 436.636 million new shares which values Micro's share at 22 sen per share.

Based on the RM102 million indicative price, FRB will end up
with more than 33 per cent shareholding in Micro and will be obliged to undertake a general offer.

Formis said the proposed disposal forms part of a plan that is currently being finalised to restructure Formis and to re-group its subsidiaries with similar activities.

This will create synergistic benefits in the form of enhanced operational efficiency from a larger distribution network and cross-selling to a wider client base.

Apart from that, FRB shall provide a guarantee to Micro that
the aggregate audited profit before tax of the four companies for the financial years ending March 31, 2013 and 2014 shall collectively be not less than RM24 million.

Going forward, FRB said that the loss of earnings generated by
the four companies would result in lower earnings. -- Bernama