AKN may give up plan to list unit

AKN may give up plan to list unit
By DAVID TAN

PENANG: AKN Technology Bhd may abandon plans to list subsidiary Paramount Discovery Group (PDG) in Singapore.

In 2006, AKN paid RM90mil for PDG, which specialises in manufacturing and supplying polymer coating solution to the glove manufacturing industry for the production of powder-free rubber and synthetic gloves.

The group had taken a short-term loan of RM40mil to RM50mil to part finance the original acquisition of PDG and the proposed listing on the Singapore Stock Exchange would have allowed AKN to fully settle the loans and still maintain control of PDG.

“But, faced with the recent slowdown in the US and a gloomy global economic climate, the management of AKN is now exploring the sale of PDG,” sources told StarBiz.

It is learnt that several companies, including private equity groups, are now in talks with AKN to acquire PDG, which is estimated to be valued at RM140mil to RM190mil.

A decision on the sale of PDG would be made soon, the sources added.

PDG is a highly profitable company and has already positioned itself as a leader in the competitive glove industry of Malaysia.

Most glove companies in Malaysia, which supply about 60% of the gloves used worldwide, are PDG’s customers.

Before proposing to list in Singapore, AKN had considered listing PDG in Malaysia, but the “chain listing” ruling of Bursa Malaysia prevented it from happening.

AKN has a good track record of loans repayments, as it had settled RM50mil of bonds in 2004 and another RM45mil of a collaterised loan obligations facility in November 2007.

AKN, listed in 1998, was founded by established technopreneur Datuk Ahmad Kabeer Mohamed Nagoor.