Quick take: Tadmax shares up 16% on disposal move

KUALA LUMPUR: Shares in Tadmax Resources Bhd rose this morning after the company announced a plan to sell an additional 40% stake in its Pulau Indah power plant project.

The counter jumped 16.13%, or 2.5 sen to 18 sen, its highest in two weeks. It is currently trading at a PE ratio of 4.69 times.

Tadmax has received a letter dated March 16 from Selangor state-linked Worldwide Holdings Bhd expressing interest to acquire the additional 40% equity interest in the project company, Pulau Indah Power Plant Sdn Bhd (PIPP). This is on top of the 35% stake Worldwide already owns.

Under a heads of agreement dated Sept 14, 2018, Tadmax was slated to partner Worldwide and Korean Electric Power Corp (Kepco) for the 1,200MW power plant under a proposed shareholding of 40:35:25 respectively in PIPP, then known as Tadmax Indah Power.

Earlier this month, Tadmax announced the disposal of its 35% stake in a power plant on Pulau Indah, Selangor for RM58.45mil cash.However, it has not inked an share sale agreement (SSA) with Kepco for the other 25% stake.

Depending on Kepco’s undertaking in PIPP, the new offer by Worldwide is set to result in Tadmax having only a 25% interest in the power plant project, or even exiting the project entirely.

Source: TheStar