Lagenda Properties Berhad Issues Circular on Shareholders’ Mandate Renewal and Share Buy-Back Authority

Date: 30 April 2026

Key Highlights for Investors

• Lagenda Properties Berhad (“Lagenda”) seeks shareholder approval to renew and expand mandates for Recurrent Related Party Transactions (RRPTs) and the authority for share buy-backs up to 10% of its total issued shares.
• The proposals will be voted on at the company’s 25th Annual General Meeting (AGM) scheduled for 10 June 2026.
• Both proposals, if approved, may have significant implications on Lagenda’s operations, financial flexibility, and share price dynamics.

1. Proposed Renewal of Shareholders’ Mandate for RRPTs

Lagenda is seeking shareholders’ approval to renew its mandate for both existing and new recurrent related party transactions of a revenue or trading nature. These transactions are necessary for the Group’s day-to-day operations and involve dealings with Directors, major shareholders, and their connected parties. The RRPTs cover property rentals, supply of construction materials, provision of renovation and childcare services, and management services, among others.

Key Points of the RRPT Mandate:

• The RRPTs are conducted on an arm’s-length basis, on terms not more favourable to related parties than to the public, and are subject to annual renewal and regulatory disclosure.
• The mandate covers both ongoing transactions (rental, supply, services) and introduces several new RRPTs for the coming year, including substantial supply contracts and management services to various related parties.
• Detailed estimated aggregate values for each RRPT are disclosed, with some transactions reaching up to RM150 million (e.g., supply of construction materials to related parties).
• Any Director, major shareholder, or connected person interested in these transactions must abstain from voting on the respective resolutions.
• Procedures for transaction pricing ensure comparison with third-party benchmarks and regular ARMC (Audit and Risk Management Committee) oversight, with additional controls if required.
• Outstanding amounts due from related parties are actively monitored, with steps taken for recovery and management asserting no credit risk issues.
• Annual report disclosure is mandated, providing transparency for shareholders.

Implications and Sensitivities:

• The size and nature of RRPTs, particularly those exceeding tens of millions of ringgit, may have a material impact on Lagenda’s financial performance, cash flow, and risk profile.
• Potential conflicts of interest are acknowledged and managed through abstentions and oversight, but investors should monitor the scale and terms of these related party dealings for any governance or value-dilutive risks.
• The inclusion of new RRPTs, especially large supply contracts, can affect revenue streams and operational focus.
• Decisions on RRPTs may affect investor perception of transparency and corporate governance.

Board Statement:

The Board (with the interested Director abstaining) unanimously recommends shareholders vote in favour of the Proposed Shareholders’ Mandate, citing operational efficiency, economies of scale, and the established reliability of related parties as key advantages. They assert the transactions are in the best interest of the Company and minority shareholders.

2. Proposed Renewal of Share Buy-Back Authority

Lagenda is also seeking to renew its authority to buy back up to 10% of its total issued shares (up to 83.7 million shares, including 4.9 million already purchased and held as treasury shares). Share buy-backs can be funded by internally generated funds and/or bank borrowings, but cannot exceed available retained profits.

Key Points of the Share Buy-Back Proposal:

• The buy-back authority is for a maximum of 10% of total shares, with flexibility to cancel, hold as treasury shares, resell, distribute as dividends, or use as consideration in corporate exercises.
• As of 31 March 2026, Lagenda’s retained profits are reported at RM33.3 million (Company level) and RM1.04 billion (Group level), with buy-backs not to exceed these amounts.
• The average purchase price of shares bought back in the past year ranged from RM1.21 to RM1.31 per share, with a total cost of RM6.2 million for 4.9 million shares.
• The buy-back will only proceed if it does not reduce the public shareholding spread below 25%.
• Purchased shares may be cancelled, retained as treasury shares, resold on Bursa Malaysia, or used for employee share schemes and other corporate purposes.
• In the case of a full 10% buy-back and cancellation, the issued share capital would reduce from 837.3 million to 753.6 million shares, potentially boosting EPS and shareholders’ value per share.
• Treasury shares do not carry voting or dividend rights and are excluded from calculations on substantial shareholdings and takeover triggers.

Potential Price-Sensitive Implications:

• Buy-backs may support Lagenda’s share price by reducing free float, enhancing EPS, and signalling management’s confidence in intrinsic value.
• The flexibility to use treasury shares for corporate transactions or as dividends may create upside for shareholders and support future M&A activity.
• Any substantial buy-back funded by borrowings may affect gearing ratios, interest outlays, and future dividend capacity, but the company states it will only proceed if financially prudent.
• If the buy-back leads to concentrated ownership, it could trigger a mandatory general offer under the Malaysian Code on Take-overs and Mergers, but the company believes this is unlikely under full implementation.
• Major shareholders will see their percentage holdings increase as a result of share cancellations, which can strengthen control but may concern some minority investors about concentration of power.

Administrative and Voting Information

• Both proposals will be tabled as ordinary resolutions at the 25th AGM on 10 June 2026 at Tropicana Golf & Country Resort, Selangor.
• Proxy forms must be lodged at the company’s business address at least 48 hours before the meeting.
• Interested Directors, major shareholders, and their connected parties will abstain from voting on resolutions where they are deemed interested.

Summary for Investors

The renewal of mandates for RRPTs and share buy-backs at Lagenda Properties Berhad represents substantial ongoing and potential future transactions that could directly impact the company’s profitability, governance, and share price. Investors should closely watch the outcome of the AGM and subsequent disclosures regarding the execution of RRPTs and any buy-back activity. The scale of related party dealings and treasury share strategies could influence both market sentiment and fundamental value.

Disclaimer

This article is prepared for informational purposes only and does not constitute investment advice, an offer, or solicitation to buy or sell any securities. Investors are advised to refer to the official documents and seek professional advice before making any investment decisions. The author and publisher accept no liability for any loss arising from reliance on the information provided herein.

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