Hextar Capital Berhad Seeks Shareholders’ Approval for Key Mandates at Upcoming AGM

Summary of Key Proposals for Shareholders’ Approval

Hextar Capital Berhad (HCB), a diversified investment holding company, has issued a comprehensive circular to shareholders ahead of its Thirtieth Annual General Meeting (30th AGM) scheduled for 19 June 2026. The company is seeking approval for several crucial proposals, including:

• Renewal of the existing shareholders’ mandate for recurrent related party transactions (RRPTs) of a revenue or trading nature;
• New shareholders’ mandate for additional RRPTs;
• Renewal of authority for the company to buy back its own shares up to 10% of the issued share capital.

Details of Proposed Mandates on Recurrent Related Party Transactions (RRPTs)

HCB is seeking to renew and expand existing mandates to enter into RRPTs with several related parties, which are essential to the group’s day-to-day operations. These transactions cover the purchase and sale of goods and services across the group’s subsidiaries and related companies, enabling HCB to operate efficiently without the need to convene extraordinary general meetings for every transaction.

The mandates, if approved, will remain in force until the next AGM, unless revoked or varied by shareholders. The company has outlined a detailed framework to ensure all RRPTs are conducted at arm’s length, on commercial terms that are not more favourable to related parties than those generally available to the public, and are not detrimental to minority shareholders.

Key RRPTs and Estimated Transaction Values

• Purchase of construction and building materials from CIBC Technology Sdn. Bhd.: Estimated aggregate value up to RM100 million from the forthcoming AGM to the next AGM. No actual value transacted in the preceding period, but the estimate is increased to cater for potential large-scale projects and operational flexibility.
• Supply of goods and services to Hextar Global Berhad (HGB) Group: Estimated at RM30 million, with RM4.98 million already transacted up to latest practicable date (LPD).
• Purchase of lubricant-related additives from HGB Group: Estimated at RM500,000.
• Supply of fibre optic cables and engineering services to Binasat Communications Berhad (BCB) Group: Estimated at RM50 million, with RM1.1 million already transacted.
• Supply of transformer oil and engineering services to Transgrid Ventures Sdn. Bhd. (TVSB): Estimated at RM5 million.
• Proposed New Mandate: Includes procurement of civil engineering services from Hextar Industries Berhad (HIB) Group (RM15 million) and purchase of engineering and maintenance services from BCB Group (RM50 million).

Notably, HCB reported that the actual value of transactions with BCB Group in the previous mandate period exceeded the estimated value by more than 10% due to higher demand and growth in BCB’s order book. This was immediately announced to Bursa Securities as required by regulations.

Governance & Safeguards

• All RRPTs are reviewed quarterly by the Audit Committee and reported to the Board.
• Transactions are benchmarked against at least two similar third-party transactions to ensure fairness, or justified in line with industry norms if comparables are not available.
• Interested directors and major shareholders, as well as persons connected to them, will abstain from voting on the relevant resolutions.
• The Audit Committee affirms that HCB has adequate procedures to monitor RRPTs, which are reviewed every three years.

Share Buy-Back Authority Renewal

HCB is also seeking to renew its authority to purchase up to 10% of its issued share capital on Bursa Securities. As of the latest practicable date, this could amount to a maximum of 58,105,322 shares, based on the current share capital of 581,053,222 shares. If all employee share options are exercised, the maximum would be 59,955,322 shares.

The company may:

• Cancel the repurchased shares;
• Retain them as treasury shares for resale, distribution as dividends, transfer as purchase consideration, or use for employee share schemes;
• Or a combination of the above.

Potential Impact on Shareholders and Share Price

• EPS Improvement: Cancellation of shares would reduce the denominator in EPS calculations, potentially boosting EPS and supporting the share price.
• Market Support: Share buy-backs may help stabilise the share price by reducing supply and signalling management’s confidence in the company’s value.
• Financial Resource Allocation: The buy-back will be funded by internally generated funds and/or bank borrowings, subject to a retained profit of RM1.8 million as at 31 December 2025. The Board will ensure the company’s solvency and that the public float remains above 25%.
• Public Shareholding Spread: After a full buy-back, the public shareholding spread could decrease to 66.93% (minimum scenario) but will remain well above the 25% threshold.

Directors’ and Major Shareholders’ Interests

Certain major shareholders and directors, including Dato’ Ong Choo Meng, Datin Sri M. Saraswathy A/P Manikum, and Dato Sri J.O. Nantha Kumar A/L J.C. Ramalu, have direct or indirect interests in the RRPTs and will abstain from voting on the relevant resolutions. There are no direct or deemed interests for directors in the share buy-back proposal, other than the potential for increased percentage shareholding due to a reduced share base.

Material Litigation

The company disclosed a single material litigation case: Opcom Cables Sdn. Bhd. (a subsidiary) is seeking to recover RM440,400 for goods sold and delivered to Forward Resources & Construction Sdn. Bhd., which has since been wound up. The outcome is pending the First Creditor’s Meeting from the insolvency department.

Share Price Performance

HCB shares have traded between RM0.18 and RM0.36 over the past 15 months, closing at RM0.20 as at the latest practicable date.

What Shareholders Should Note (Potential Price-Sensitive Information)

• The substantial increase in estimated RRPT values—especially the RM100 million estimate for purchases from CIBC, and the RM50 million each for transactions with BCB and HIB Groups—signals major project opportunities and potential revenue expansion.
• The company’s proactive governance and prompt disclosure when RRPT transaction values exceeded estimates enhances transparency and may boost investor confidence.
• The share buy-back authority, if executed, could have a significant positive impact on EPS, provide market support for the share price, and reward shareholders via potential share dividends or capital gains from resold treasury shares.
• No material litigation or claims are expected to materially affect group performance.
• Shareholders are encouraged to submit proxy forms by 17 June 2026 if unable to attend the AGM and to review the full circular and annual report for complete details.

Conclusion

The proposals outlined by Hextar Capital Berhad are potentially significant for the company’s growth trajectory and shareholder value. The authorisation to enter into high-value RRPTs and to buy back shares up to 10% of the issued capital could enhance operational flexibility, improve financial metrics, and support the market price of HCB shares. Investors should closely monitor the resolutions at the upcoming AGM, as approval and execution of these mandates could be price sensitive and have a material impact on the company’s prospects.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any securities. Investors are advised to conduct their own due diligence and consult with their independent advisers before making investment decisions. The information provided is based on the latest available company disclosures as of 30 April 2026 and may be subject to change.

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