Tune Protect Group Berhad: Key Updates for Investors from 2026 AGM Circular

Introduction

Tune Protect Group Berhad (TPG) has released its Circular and Statement to shareholders in anticipation of its Fifteenth Annual General Meeting (AGM) scheduled for 24 June 2026. This document contains two major proposals that are both significant for investors and could impact the company’s future direction and share price:

• Proposed renewal of shareholders’ mandate for Recurrent Related Party Transactions (RRPTs) of a revenue or trading nature.
• Proposed renewal of authority for the company to purchase its own shares of up to 10% of its issued capital (Share Buy-Back Authority).

Key Points from the Circular

1. Proposed Renewal of Shareholders’ Mandate for RRPTs

What is it?
TPG seeks shareholders’ approval to continue entering into RRPTs with related parties. These transactions are essential for day-to-day operations and include dealings with major shareholders and companies within the AirAsia/Capital A ecosystem.

Key Details:

• Major Related Parties: AirAsia, AirAsia X, Move Digital, Move Travel, Rokki, SGIB, Tune Group, etc.
• Nature of Transactions: Mainly provision of travel insurance to AirAsia and AirAsia X customers, licensing of ‘Tune Insurance’ trademark, rental and utilities, insurance broking, advertising, and provision of insurance products via Move Travel’s e-commerce platform.
• Estimated Aggregate Value: For the period from 24 June 2026 up to the next AGM:
  • AirAsia: RM18.6 million
  • AirAsia X: RM4.3 million
  • Tune Group trademark license and rental: RM9.41 million (license), RM2.4 million (rental)
  • Move Travel: RM225,000
  • Rokki: RM3 million (advertising expenses)
  • SGIB: RM600,000 (insurance broking)
• Actual Values Transacted (as of Mar 2026): For example, AirAsia transacted RM8.51 million, AirAsia X RM1.989 million, Move Travel RM65,000, and Rokki RM78,000.
• Reason & Benefit: Streamlines approval process for frequent, necessary business transactions with related parties, saves time and cost, and supports business continuity.
• Review Procedures:
  • Quarterly audit committee reviews.
  • Transactions must be at arm’s length and not more favorable to related parties than to the public.
  • Interested parties abstain from voting.
• Potential Impact: These RRPTs are expected to contribute positively to TPG’s earnings, supporting net assets and gearing. No impact on share capital or substantial shareholdings, but could be price-sensitive if transaction volumes significantly increase or decrease.

2. Proposed Renewal of Share Buy-Back Authority

What is it?
Authority for TPG to purchase up to 10% of its issued shares (up to 75.36 million shares, based on current issue size of 753.64 million shares).

Key Details:

• Fund Limit: Share buy-backs will be funded by retained profits (RM42 million as at 31 December 2025), via internal funds and/or borrowings.
• Pricing: Purchases may be made at up to 15% above the 5-day weighted average market price; resale must not be below the 5-day average (with some exceptions for discount).
• Treatment of Purchased Shares: May be cancelled, held as treasury shares, re-sold, transferred for employee share schemes, or used as purchase consideration in transactions.
• Rationale: Potential to stabilise share price, provide flexibility for treasury management, and possibly deliver share dividends to shareholders.
• Financial Effects:
  • If all shares are cancelled, share capital would drop to 678.28 million shares.
  • Buy-back could improve EPS by reducing share count, potentially enhancing share value.
  • Reduces working capital and could impact NA per share and gearing, depending on funding source and buy-back price.
• Shareholding Impact: Buy-backs could raise the percentage holding of major shareholders and directors; for example, Tune Group and Move Digital’s effective stake would rise (e.g., Tune Group from 15.73% to 17.48%).
• Public Spread: Company will ensure public shareholding remains above 25% as required by Bursa Malaysia.
• Historical Share Price (Past 12 Months):
  • High: RM0.36
  • Low: RM0.26
  • Last traded: RM0.28
• Mandatory Takeover Implications: Company will avoid triggering a general offer obligation for substantial shareholders under the takeover code.

3. Material Litigation

• Ongoing Litigation with Malaysia Competition Commission (MyCC): TPG’s subsidiary, Tune Insurance Malaysia Berhad (TPM), faces a potential liability of RM2.57 million for alleged competition law infringements. The case is now pending appeal in the Court of Appeal, with a hearing set for 30 April 2026. The outcome could have a financial impact if adverse.

Important Considerations and Potential Price-Sensitive Elements

• Share Buy-Backs: Large-scale buy-backs can support share price or signal management’s confidence. If exercised, this could be price supportive, especially if shares are undervalued.
• RRPTs with AirAsia and Related Parties: The volume and continuity of these transactions are material to TPG’s earnings. Any material changes, enhancements, or cessation of these agreements could affect revenue and share price.
• Litigation Outcome: The final decision in the MyCC case could affect financials and investor sentiment.
• Major Shareholder Concentration: Share buy-back will increase the percentage control of existing major shareholders, which could influence future corporate actions.
• Disclosure and Transparency: Immediate announcement is required if actual RRPT values exceed estimates by 10% or more, providing timely market information.

Conclusion

Investors should closely monitor the outcome of the AGM on 24 June 2026. Approval and implementation of these mandates could have material implications on TPG’s earnings, share price dynamics, ownership structure, and corporate governance. The ongoing litigation is also a potential risk factor that shareholders should watch.

Disclaimer

This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence and consult with professional advisors before making any investment decisions. The information is based on official documents and may be subject to change or updates.

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