Zetrix AI Berhad Proposes Renewal of Share Buy-Back Authority: Key Details and Implications for Investors

Introduction

Zetrix AI Berhad (formerly known as MY E.G. Services Berhad) has announced that it will seek shareholder approval for the proposed renewal of its authority to purchase up to ten percent (10%) of its own issued ordinary shares (“Proposed Renewal of Share Buy-Back Authority”). This resolution will be tabled as special business at the upcoming 25th Annual General Meeting (AGM) scheduled for 24 June 2026 at the KLGCC Convention Centre, Kuala Lumpur.

Key Points from the Report

• Buy-Back Authority Details: The Board proposes to renew the authority to purchase up to 10% of the company’s issued shares through appointed stockbrokers. This is in accordance with Section 127 of the Companies Act 2016 and Bursa Malaysia’s Main Market Listing Requirements.
• Scope and Validity: The proposed authority is effective immediately upon passing the resolution at the 25th AGM and will remain valid until the next AGM, expiry of the statutory period for holding the next AGM, or if revoked by shareholders.
• Maximum Buy-Back Volume: As of 1 April 2026, Zetrix AI has 8,058,130,141 issued shares (including 122,278,800 Treasury Shares). The maximum number of shares that may be repurchased is 805,813,014, representing 10% of the issued shares.
• Treatment of Repurchased Shares: Shares bought back may be cancelled, retained as treasury shares, or partially cancelled/retained. Treasury shares may be distributed as dividends, resold, used for employee share schemes, or as purchase consideration in transactions.
• Funding: Buy-backs will be funded by retained profits (RM379.9 million as at 31 December 2025) and/or external borrowings, subject to compliance with solvency tests and careful cash flow management.
• Pricing: The purchase price cannot exceed 15% above the 5-day weighted average market price before the purchase. Resale or transfer of treasury shares must be no less than the 5-day weighted average price or up to a 5% discount if held for at least 30 days and not sold below cost.
• Public Spread Requirement: The company will ensure the public shareholding spread remains above the minimum 25% threshold post-buyback (currently at 70.227%, expected to drop to 66.862% if fully implemented).
• Historical Share Price Data: Over the past 12 months, share prices ranged from RM0.635 to RM1.03. The last traded price as of the latest practicable date was RM0.755.
• Recent Share Buy-Back Activity: In the 12 months preceding the report, 117,075,900 shares were repurchased for RM82.68 million, with 122,278,800 shares currently held as treasury shares. 100,000,000 treasury shares were cancelled in the period.
• Shareholder Impact: The buy-back could result in an increase in earnings per share (EPS) and return on equity (ROE) if shares are cancelled, and offers flexibility for capital management.
• Shareholding Structure Impact: Buy-back may inadvertently increase the percentage holdings of major shareholders and directors, which could have implications under Malaysian takeover rules.
• Potential Disadvantages: Buy-back reduces available financial resources, could affect cash flow if financed by borrowings, and may reduce resources for future distributions.
• Regulatory Compliance: Bursa Malaysia has not reviewed the statement as it is an exempt document, and takes no responsibility for its content.

Important Considerations for Shareholders

• Voting at the AGM: Shareholders should carefully consider the merits of the proposed renewal and exercise their voting rights. Proxy forms must be submitted at least 48 hours before the AGM.
• Price-Sensitive Implications:
  • A share buy-back can signal management’s confidence in the intrinsic value of the company, often supporting share price performance and potentially reducing volatility.
  • If buy-backs are conducted at prices below intrinsic value, it may boost EPS and ROE, potentially making shares more attractive to investors.
  • The cancellation of shares leads to a reduction in share capital, which can enhance the value of remaining shares but may also affect liquidity.
  • The increased percentage holdings of major shareholders could, in some scenarios, trigger a mandatory takeover offer if thresholds under Malaysia’s takeover code are breached. The company intends to avoid this but investors should monitor regulatory disclosures.
  • The buy-back is subject to the company’s available retained profits and compliance with all regulatory requirements.
• Risks: Use of cash or borrowings for buy-backs reduces the company’s flexibility for future investments or dividends and may affect the company’s financial position if not carefully managed.
• Directors’ Recommendation: The Board unanimously recommends shareholders to vote in favour, viewing the proposal as fair, reasonable, and in the best interests of the company.
• Inspection of Documents: The company’s Constitution and audited financial statements for the last two financial years are available for inspection at the registered office.

Conclusion

The proposed renewal of the share buy-back authority is a significant corporate action that could influence Zetrix AI’s share price, trading liquidity, and capital structure. Shareholders are advised to review the full details, consider the potential benefits and risks, and participate in the voting process at the upcoming AGM.

Disclaimer: This article is prepared for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should consult their own financial advisors and review official company documents and announcements before making any investment decisions. The writer assumes no responsibility or liability for any errors or omissions in the content of this article.

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