1. Introduction and information on the Related Party Transaction
The Board of Directors of MEASAT Global had on 28 February 2006 announced that as a result of manufacturing delays by Boeing Satellite Systems International, Inc (“Boeing”) the launch of the MEASAT-3 satellite by its wholly-owned subsidiary, MEASAT Satellite Systems Sdn Bhd (“MSS”) is not expected before the latter half of 2006.
On 12 July 2001, Malaysian Tobacco Company Berhad (as MEASAT Global was then known) entered into a Share Sale Agreement with MEASAT Global Network Systems Sdn Bhd (“MGNS”) in relation to the sale by MGNS to the Company of shares in Binariang Satellite Systems Sdn Bhd (as MSS was then known) (“SSA”).
Pursuant to Clause 9.2 of the SSA, MGNS provided an undertaking to the Company that MSS will acquire and launch one satellite or acquire an existing launched satellite within 4 years from the Completion Date (as defined in the SSA) i.e. by 7 May 2006 (“Deadline”). MGNS sought the Company’s agreement to extend the Deadline to 31 December 2007 to fulfill the aforesaid undertaking (“Extension”).
The Board of MEASAT Global wishes to announce that the Company has on 6 May 2006 agreed to grant MGNS the Extension (“Transaction”).
The grant of the Extension is a Related Party Transaction pursuant to Paragraph 10.08 of the LR as it involves the interests of major shareholders of the Company.
2. Information on the Transacting Parties
2.1 MEASAT Global
MEASAT Global was incorporated in Malaysia on 28 September 1956 under Section 15(1) of the (then) Companies Ordinances, 1940 to 1946 as Malayan Tobacco Company Limited.
The Company adopted its present name on 23 July 2003.
The principal activity of MEASAT Global is investment holding. It has an authorized share capital of RM313,950,000 comprising 402,500,000 ordinary shares of RM0.78 each, of which 389,933,155 ordinary shares have been issued and paid up.
2.2 MGNS
MGNS, incorporated in Malaysia on 12 May 1992, is a wholly-owned subsidiary of Media Nusantara Sdn Bhd (“MNSB”) which in turn is wholly-owned by MAI Holdings Sdn Bhd (“MAIH”).
MGNS is an investment holding company with an authorized share capital of RM25,000 comprising 25,000 ordinary shares of RM1.00 each of which 2 ordinary shares have been issued and paid up.
3. Rationale
MSS had executed a contract with Boeing on 21 March 2003 for the procurement of MEASAT-3 for an original delivery date of 22 May 2005 which now has to be deferred due to manufacturing delays.
The Extension is in relation to a post-completion obligation of MGNS under the SSA. MGNS is unable to fulfill the undertaking for reasons outside the control of the parties. In the circumstances the grant of the Extension is reasonable.
4. Directors and Major Shareholders Interest and Nature of Relationship
None of the Directors or major shareholders of MEASAT Global or persons connected with them has any interest, direct or indirect, in the Transaction, save for the following major shareholders and Director:
Major Shareholders:
| 1) |
Ananda Krishnan Tatparanandam (“TAK”);
|
| 2) |
MAIH; |
| 3) |
MNSB; and |
| 4) |
MGNS. |
Director:
MGNS is a major shareholder of MEASAT Global with an equity interest over 232,233,703 ordinary shares in MEASAT Global representing 59.56% of the share capital of MEASAT Global. MGNS is wholly-owned by MNSB, which in turn is wholly-owned by MAIH. TAK has a direct equity interest in 99.999% of the share capital of MAIH. Accordingly, MNSB, MAIH and TAK are also deemed to have an interest over all the 232,233,703 shares in MEASAT Global in which MGNS has an interest.
RM is a nominee Director of MGNS on the Board of MEASAT Global. He does not have any direct or indirect shareholding interest in MEASAT Global, MGNS, MNSB or MAIH.
5. Statement by the Board of Directors of MEASAT Global
The Board (save for RM who has abstained from all deliberations and decision) having taken into consideration all aspects of the Transaction is of the opinion that the Transaction is in the best interest of MEASAT Global.
6. Financial Effect of the Transaction
The Transaction does not have any effect on the issued and paid-up capital nor any material effect on the earnings and net assets of the MEASAT Global Group or on the shareholdings of the substantial shareholders.
7. Approval Required
The Transaction does not require MEASAT’s Global shareholders’ approval or approvals from any relevant authorities.
This Announcement is dated 9 May 2006
