RCE Capital Berhad: Key Proposals for Shareholders at the 72nd AGM
Major Developments: Shareholders’ Mandate for RRPT and Share Buy-Back Renewal
RCE Capital Berhad has released its Circular/Statement to shareholders ahead of its 72nd Annual General Meeting (AGM) scheduled for 3 September 2026. The document outlines two significant proposals that have direct implications for shareholders and could be price-sensitive:
- Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions (RRPT) of a Revenue or Trading Nature
- Renewal of Share Buy-Back Authority
1. Proposed Shareholders’ Mandate for RRPT
Key Points and Investor Impact
- The mandate allows RCE Group to continue entering into recurrent transactions with related parties, which are crucial for its daily operations and revenue streams.
- These transactions are subject to annual renewal and must be undertaken at arm’s length, on normal commercial terms, and not more favourable to related parties than those available to the public.
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The RRPTs involve substantial estimated transaction values, including:
- Clear Goal Sdn Bhd (CGSB) Group: Estimated RM20 million for services including office rental, management support, hospitality, IT, consultancy, and financial services.
- AMMB Holdings Berhad (AHB) Group: Up to RM15 million for investment management, collection management, and sales/marketing services.
- Amcorp Global Limited (AmG) Group: Estimated RM5 million for factoring and other financial services.
- Price-Sensitive Consideration: The RRPTs are with related parties that include directors and major shareholders such as Shahman Azman, Shalina Azman, Lum Sing Fai, Tan Sri Azman Hashim, and entities like CESB and AMCORP. The relationships are fully disclosed, and all interested parties will abstain from voting.
- The Audit Committee has affirmed that robust internal controls and quarterly reviews are in place to ensure these transactions are not detrimental to minority shareholders, preserving fair value and market integrity.
- Potential Share Price Impact: The ongoing RRPTs provide operational stability, cost synergies, and revenue streams that could enhance the Group’s earnings and operational efficiency, which are potentially positive for share price valuation.
2. Proposed Renewal of Share Buy-Back Authority
Key Points and Investor Impact
- Shareholders are being asked to approve the renewal of authority for RCE to buy back up to 10% of its issued shares (up to 148,446,753 shares based on current figures).
- The buy-back can be executed using retained profits, which stood at RM142.4 million as at 31 March 2026.
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Share Price Sensitivity:
- A full buy-back could reduce the total number of issued shares to 1.34 billion (from 1.48 billion), potentially increasing EPS and supporting the share price.
- If treasury shares are resold at a higher price, this could generate additional capital for the company.
- If treasury shares are cancelled, the reduction in share base could enhance the value of remaining shares.
- The public shareholding spread would be reduced to 33.29% if the buy-back is fully executed, but the Board has committed to ensuring compliance with Bursa Malaysia’s public spread requirements.
- CESB’s shareholding would rise from 59.21% to 65.06% in a full buy-back scenario. However, as these parties already control more than 50%, there is no mandatory general offer triggered under the Malaysian Code on Take-Overs and Mergers.
- Risks: The buy-back could reduce financial resources available for other investments or future dividends, and working capital may be impacted depending on the scale of buy-back and source of funds.
3. Additional Important Details for Shareholders
- All directors and major shareholders with interests in the RRPT will abstain from board deliberations and voting. Persons connected to them will also abstain from voting.
- Shareholders are encouraged to review the Administrative Guide and submit proxy forms as appropriate. Details on electronic lodgement and deadlines are provided in the Circular and on the company website.
- The company confirms there are no material contracts or litigation that could impact its financial position as at 30 June 2026.
Conclusion and Investor Takeaways
Both proposals—the RRPT mandate and share buy-back renewal—are integral to RCE’s ongoing operational and capital management strategies. The RRPT mandate ensures business continuity with key partners, while the buy-back authority provides flexibility to manage capital structure and potentially support the share price.
Investors should closely monitor the outcomes of the 72nd AGM, as approval and subsequent action on these mandates could influence market sentiment and RCE’s share performance in the near term.
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 research and consult professional advisors before making investment decisions.
