KUALA LUMPUR: Hong Seng Consolidated Bhd has acquired 402,057,900 ordinary shares in Classita Holdings Bhd, representing a 32.61 per cent equity interest, for RM60.31 million cash.

       In a Bursa Malaysia filing today, the glove manufacturer, medical and healthcare-related supply chain management specialist, and financial services provider said that subsequent to the investment, it has become the major shareholder of Classita.

       Classita is principally engaged in the businesses of property development and construction, manufacturing and sales of undergarments as well as direct selling and retail of ladies' undergarments, childcare and maternity products, and other consumer products.

       "The purchase consideration was given for the investment in a substantial block of shares, which constitutes the current largest shareholding in Classita, and the purchase price per share of RM0.15 represents a discount of approximately 6.25 per cent to the abovementioned net assets per share of RM0.16.

       "The purchase consideration is funded via the group's internally generated funds,” it said.

       Meanwhile, the Classita group has been continuously seeking to penetrate new export markets while optimising operational costs through strategic partnerships in Myanmar and Indonesia.

       "The company aims to enhance its presence beyond the European, Canadian, US, and Hong Kong markets to expand its business and customer base.

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       "Additionally, the Classita group has realigned its resources to revive its property business following the gradual recovery of the property sector and is actively seeking potential development projects to expand its footprint,” it said.

       Hong Seng believes the investment will bring sustainable value and benefits to the group, considering Classita's aforementioned potential and its prospects.

       "According to the overview and outlook of the undergarments industry in Malaysia, the retail sales value of women's undergarments in Malaysia rose from RM1.26 billion in 2018 to RM1.3 billion in 2019, at a compound annual growth rate of 3.3 per cent.

       "In view of the above prospects and positive outlook of the Classita Group, Hong Seng opines that the value is expected to grow and therefore, the investment will generate positive returns,” it added. - Bernama