Reference is made to the utilisation of proceeds raised from the Initial Public Offering (“IPO”) as disclosed in the Company’s prospectus dated 29 June 2016 that was issued in conjunction with the listing of the Company on the ACE Market of Bursa Malaysia Securities Berhad on 10 August 2016, the announcements dated 6 February 2018, 23 December 2020 and 18 November 2021 respectively in relation to Variations and Extension of timeframe (“EOT”) for utilisation of proceeds raised from the IPO and Circular to Shareholders of HEB dated 23 May 2019 and 20 May 2022. As at to-date, the Company remains a balance of RM6 million IPO proceeds which has yet to be utilised ("Balance IPO Proceeds").

1.  INTRODUCTION

The Board of Directors of HEB (“Board”) wishes to announce that it has deliberated and resolved to further extend the timeframe for the utilisation of the Balance IPO Proceeds allocated for expansion into India & ASEAN, and venture into recurring income and long-term based contracts with focus within the power sector which were initially intended to be utilised up to 31 December 2023.

2. DETAILS OF THE EOT FOR THE UTILISATION OF PROCEEDS

As at the date of this announcement, the Company has utilised approximately RM25.91 million from the total IPO Proceeds of RM31.91 million. The Company has yet to fully utilise the IPO Proceeds allocated for expansion into India & ASEAN, and venture into recurring income and long-term based contracts with focus within the power sector that were initially intended to be utilised by 31 December 2023. The details of the EOT are set out as follows:-

3. RATIONALE FOR THE EOT

Our expansion plan is centred on, amongst others, the expansion into the India and ASEAN markets as well as on long-term contracts generating recurring income, with focus on the power sector (mainly renewable energy).

Expanding our footprint into the Indian and ASEAN markets represents a significant milestone in our strategic plan and the Company has identified numerous opportunities in these regions. The Board firmly believes that the strategic plans for growth in the Indian and ASEAN markets are set to materialise, with a strong outlook for the next year. This extension allows us to make well-informed decisions, capitalise on these opportunities, and navigate the evolving landscape of these markets effectively.

Under the National Energy Transition Roadmap, the Government aims for a new renewable energy installed capacity of 70% by 2050. It aims to achieve this target predominantly by increasing the number of solar panel installations. In line with the foregoing, the Company is exploring and evaluating opportunities within the renewable energy sector and will make the necessary announcements in accordance with the Listing Requirements as and when the new businesses or contracts have been identified and are likely to materialise.

The development of renewable energy project demands a meticulous planning process to ensure long-term viability and contributions to our stable revenue base. Such projects often need significant initial investments for capital expenditure needs, includes costs of project development. To this end, the Board wishes to reiterate its belief that an entry into the renewable energy sector will not only diversify income streams but also create a stable and sustainable revenue base.

After due deliberation, the Board has decided to extend the timeframe for the utilisation of proceeds to be utilised by 31 December 2024.

4. EFFECTS OF THE EOT

The EOT will not have any effect on the issued share capital, substantial shareholders' shareholdings, earnings and earnings per share of HEB Group. The EOT is expected to contribute positively to the future earnings of HEB Group as and when the benefits of the utilisation of the proceeds are realised.

5. APPROVAL REQUIRED

The EOT is not subject to any regulatory authorities or shareholders’ approval. Nevertheless, the Board shall continue to be vigilant and prudent in managing the Balance IPO Proceeds and will continue to disclose the status of the utilisation of the Balance IPO Proceeds in its quarterly reports and annual report until its full utilisation.

The Board is of the opinion that the EOT will not have any adverse effect on the financial performance of the Company and is in the best interest of the Company.  

This announcement is dated 29 December 2023.