Unless otherwise defined, the definitions set out in the previous announcement in relation to the Proposed Regularisation Plan shall apply herein.
On behalf of the Board of Directors of MMM, M & A Securities wishes to announce that Bursa Securities had vide its letter dated 10 July 2026 informed that after due consideration of all facts and circumstances of the matter, Bursa Securities has decided to reject the Proposed Regularisation Plan as the Company and its Principal Adviser have not demonstrated to the satisfaction of Bursa Securities on the ability of the Proposed Regularisation Plan to comply with Paragraphs 5.4 and 5.5 of PN17 of the MMLR based on, amongst others, the following:
(i) Concerns on whether the proposed acquisition of 500,000 ordinary shares in EDSB, representing 100% equity interest in EDSB by MMM, for a total purchase consideration of RM 16 million to be fully satisfied by way of cash, being the key component of the Proposed Regularisation Plan, satisfies Paragraph 5.4(c) of PN17, which requires the regularisation plan to be fair and reasonable to the listed issuer and its securities holders and which is expected to result in a sustainable enhancement in value to its securities holders, in view of the following:
(a) The acquisition consideration of RM16.0 million represents a substantial premium over EDSB net assets as at 31 December 2025 of approximately RM0.8 million.
(b) The total investment required by MMM is approximately RM22.16 million, taking into account the acquisition consideration and the proposed conversion of 26 out of 228 of EDSB's static billboards into digital billboards.
(c) Whilst Chong Yoke Lai and Gan Soon Choon have provided a guarantee that EDSB shall achieve the guaranteed PAT of RM2.0 million for each of the FYEs 31 December 2026, 2027, and 2028 respectively, amounting to a total guaranteed PAT of RM6.0 million, the guaranteed earnings are significantly lower than the acquisition consideration and do not, in themselves, demonstrate the long-term sustainability of EDSB's earnings and growth prospects beyond the Profit Guarantee Period.
(d) The Proposed Acquisition is to be satisfied entirely in cash, resulting in the Vendor having no equity participation in the enlarged Group upon completion. Consequently, the Vendors will not participate in the future risks and performance of the business, giving rise on the alignment of interests between the Vendors and MMM's existing shareholders.
Accordingly, it is not evident that the Proposed Acquisition adequately safeguards the interests of MMM and its securities holders or that it will result in a sustainable enhancement in shareholder value as envisaged under Paragraph 5.4(c) of PN17.
(ii) Concerns on the sustainability and viability of the enlarged Group following the Proposed Acquisition, which forms the cornerstone of the Proposed Regularisation Plan, given the following:
(a) EDSB's revenue has been on a declining trend over the past three financial years from RM8.62 million in FYE 31 December 2023 to RM6.09 million in FYE 31 December 2025, and recorded losses in three of the past four financial years from FYE 31 December 2022 to 2025, indicating weakening business momentum and raising concerns on the sustainability of its operations, earnings resilience and future growth prospects. Notwithstanding the Proposed Acquisition (which includes the conversion of 26 out of 228 of EDSB's static billboards into digital billboards), it is unclear whether the revenue decline can be reversed and whether EDSB is capable of providing MMM with a sustainable platform for long-term growth.
(b) Of EDSB's 228 billboard sites, only 62 sites currently hold the relevant advertising licences and permits. Whilst completion of the Proposed Acquisition is conditional upon EDSB obtaining and maintaining the requisite licences, permits and approvals for 144 operating sites (out of 228 sites), there may be a delay in the implementation of the Proposed Regularisation Plan as EDSB expects to obtain the approvals for these billboard sites by second quarter of 2027.
Further, MMM may need to incur additional costs and resources to regularise the remaining 84 sites (after the fulfilment of the condition of the Proposed Acquisition), where it is unclear whether MMM has adequately assessed the costs, timeframe and likelihood of obtaining such approvals, as well as the consequences should the approvals not be obtained.
The significant number of sites without the requisite approvals also raises concerns regarding the sustainability of EDSB's operations, including potential exposure to regulatory enforcement actions, operational disruptions and uncertainty over the continued use of the affected sites.
(c) All 228 billboard sites currently comprise static billboards. Under the Proposed Regularisation Plan, approximately RM12.16 million is proposed to be utilised to convert only 26 of EDSB's static billboards into digital billboards over a 36-month period. MMM may therefore be required to incur substantial additional capital expenditure in the future should it seek to convert the remaining 202 of EDSB's static billboards.
Taken together, the above factors raise concerns as to whether EDSB is capable of providing MMM with a sustainable and viable platform for long-term growth.
(iii) Notwithstanding the improved financial performance recorded by MMM in FYE 2026, concerns remain as to whether the Proposed Regularisation Plan adequately addresses the circumstances which resulted in MMM triggering the prescribed criteria under PN17 on a sustainable basis.
(a) Whilst the Proposed Capital Reduction would eliminate the accumulated losses of RM32.65 million and result in shareholders' equity of approximately RM42.8 million, thereby addressing Paragraph 2.1 (a) of PN17, such improvement arises primarily from the accounting effects of the capital reduction rather than from sustainable profitability generated by the Group's business operations.
(b) Further, the long-term sustainability of the enlarged Group remains heavily dependent on the successful implementation and performance of the Proposed Acquisition. Given the concerns on the fairness, reasonableness, sustainability and viability of EDSB as set out in paragraphs (i) and (ii) above, it has not been satisfactorily demonstrated that the circumstances which resulted in MMM triggering the prescribed criteria under PN17 have been comprehensively addressed, or that the risk of the Company triggering the prescribed criteria again in the future has been sufficiently mitigated.
Please be informed that pursuant to Bursa Securities' letter dated 3 November 2025, in the event:
(i) the Company fails to obtain the approval for the implementation of its regularisation plan and does not appeal within the timeframe of 30 days from the date hereof i.e. on or before 9 August 2026 as prescribed under Paragraph 8.04(4) of the MMLR; or
(ii) the Company does not succeed in its appeal.
the securities of the Company shall be removed from the Official List of Bursa Securities upon the expiry of two (2) market days from the date the Company is notified by Bursa Securities or on such other date as may be specified by Bursa Securities.
This announcement is dated 10 July 2026.