KUALA LUMPUR (Bernama) -- Hong Seng Consolidated Bhd has entered into a share sale agreement with Robust Potential Sdn Bhd for the disposal of 100 per cent equity interest in Hong Seng Priority Management Sdn Bhd (HSPM) for RM34.5 million.

       Hong Seng said the sale of two million ordinary shares of its hire purchase business will result in an estimated gain of about RM31.20 million.

       Group managing director Datuk Seri Teoh Hai Hin said the proceeds will mainly be used for working capital purposes for the group’s healthcare and glove businesses which are more sustainable.

       "We are proud to have built HSPM into a revenue-generating business, however, despite HSPM’s future earnings potential and prospects, the business would require significant working capital requirements in order to crystallise the potential earnings benefits,” he said in a statement.

       "Therefore, this timely opportunity to dispose at a gain is viewed positively by the group as it allows the group to immediately unlock and realise the value of the investment and assets in HSPM.”

       HSPM is principally engaged in the business of providing hire purchase financing.

       On August 16, 2021, it had entered into a collaboration agreement with Sino EV Assembly Sdn Bhd to work together in the business of electric vehicles in Malaysia for a period of five years.