Y&G Corporation Bhd – In-depth Investor Briefing: Proposed Renewal of Existing Shareholders’ Mandate

Key Highlights from the Circular

• The Company is seeking shareholders’ approval at the upcoming 60th AGM (28 May 2026) for the renewal of its mandate to enter into recurrent related party transactions (RRPTs) of a revenue and/or trading nature.
• The RRPTs primarily involve the provision of construction-related services by Terrajaya Plus Sdn Bhd (TPSB) to several Y&G subsidiaries.
• The renewal is necessary to facilitate day-to-day operations without the need for frequent general meetings for each transaction.
• Interested Directors and Major Shareholders (notably the Yap family and KASB) are required to abstain from all deliberations and voting related to these RRPTs.
• The estimated value of RRPTs for the period up to the next AGM is significant, with tens of millions in construction contracts expected to be transacted.
• The RRPTs are subject to stringent review and disclosure procedures overseen by the Audit and Risk Committee (ARC).
• No material litigation, contingent liabilities, or commitments (other than announced transactions) are reported that may affect the Group’s financial position.

Investor-Relevant Details and Potential Price-Sensitive Information

1. Financial Impact of RRPTs

• The RRPTs detailed in the mandate involve three major subsidiaries: DASB, MPSB, and MHSB, with TPSB acting as the service provider.

The above table highlights the material size of these transactions, demonstrating their significance to both Y&G’s revenue and cost structure.

2. Project Pipeline: Potential Revenue Drivers

• Y&G’s RRPTs are linked to three large-scale property development projects:
  • Project Hamlet, The Meadows, Kuala Selangor: Housing, GDV RM158m, cost RM113m, 2024–2027
  • Project Trifolia, Port Dickson, Negeri Sembilan: Housing, GDV RM145m, cost RM123m, 2024–2027
  • Project Kindle Estate, Rawang, Selangor: Housing, GDV RM347.4m, cost RM289m, 2026–2029
• The scale and successful execution of these projects could have a material impact on future earnings and cash flows.

3. Governance, Review Procedures and Minority Protection

• Stringent procedures are in place to ensure RRPTs are at arm’s length, on normal terms, and not detrimental to minority shareholders.
• Key controls include:
  • Quarterly review by ARC
  • Abstention from voting by interested directors/shareholders
  • Annual disclosure in the annual report
  • Immediate Bursa Malaysia announcement if actual values exceed estimates by 10% or more
  • Requirement that at least two comparable third-party transactions are used as benchmarks where possible

4. Shareholding Structure and Potential Voting Impact

• The Yap family and KASB collectively control more than 50% of Y&G shares.
• They are classified as interested parties and will abstain from voting on the renewal mandate resolution, leaving the outcome in the hands of other shareholders.
• This may affect the dynamics of the AGM and could be material if a significant minority block forms.

5. Other Noteworthy Legal and Financial Disclosures

• There are no material litigation, contingent liabilities, or unannounced commitments affecting the Group as at the latest practicable date.
• The only major contracts and commitments relate to previously announced land and company acquisitions (SPA 1, SPA 2, SSA).

Strategic and Share Price Implications

• The renewal of the RRPT mandate supports Y&G’s operational flexibility, enabling timely execution of large, revenue-generating property developments.
• The scale of the related party construction contracts (over RM90 million in aggregate for the coming year) is significant and will likely impact revenue recognition and profit margins.
• Investors should monitor the execution of the above projects, actual RRPT values vs. estimates, and any changes to the governance framework closely, as these could be price sensitive events.
• Any failure to adhere to the prescribed governance safeguards or material discrepancies in RRPT values may trigger regulatory scrutiny or minority shareholder action, with potential consequences for share price volatility.

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