MALAYSIA STEEL WORKS (KL) BHDcontent.investor.net.my/wp-content/uploads/Masteel...Company or MASTEEL : Malaysia Steel Works (KL) Bhd (Company No.: 7878-V) CA : Companies Act, 1965

MASTEEL

2

DEFINITIONS Except where the context otherwise requires, the following definitions shall apply throughout this Circular/Statement. AGM : Annual General Meeting Articles : Articles of Association of the Company Board : Board of Directors of MASTEEL Bursa Securities : Bursa Malaysia Securities Berhad Company or MASTEEL : Malaysia Steel Works (KL) Bhd (Company No.: 7878-V) CA : Companies Act, 1965 CMSA : Capital Markets and Services Act 2007 Code : Malaysian Code on Take-Overs and Mergers 2010 Direct Business Transaction : A transaction in securities entered into outside the Automated Trading

System of Bursa Securities in accordance with the Rules of Bursa Securities Director : Shall have the meaning given in Section 2(1) of the CMSA and includes any

person who is or was within the preceding 6 months of the date on which the terms of the transaction were agreed upon, a director of the Company or any other company which is its subsidiary or holding company or a chief executive officer of the Company, its subsidiary or holding company.

Group : MASTEEL and its subsidiaries Listing Requirements: Main Market Listing Requirements of Bursa Securities including any amendments thereto that maybe made from time to time. Mandated Related Party : As described in paragraph 3.3 Major Shareholder : Means a person who has an interest or interests in one or more voting shares

in the Company and the nominal amount of that share or the aggregate of the nominal amounts of those shares, is:-

(a) 10% or more of the aggregate of the nominal amounts of all the voting

shares in the Company; or

(b) 5% or more of the aggregate of the nominal amounts of all the voting shares in the Company where such person is the largest shareholder of the Company

and including any person who is or was within the preceding 6 months of

the date on which the terms of the transaction were agreed upon, a major shareholder of the Company or any other corporation which is its subsidiary or holding company.

For the purpose of this definition, “interest in shares” shall have the meaning

given in section 6A of the CA. NA : Net assets attributable to ordinary equity holders of the Company. MASTEEL

1

THIS CIRCULAR/STATEMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. IF YOU ARE IN ANY DOUBT AS TO THE COURSE OF ACTION YOU SHOULD TAKE, YOU SHOULD CONSULT YOUR STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR OTHER PROFESSIONAL ADVISER IMMEDIATELY. Bursa Malaysia Securities Berhad has not perused the contents of Part B in respect of the Statement to Shareholders prior to its issuance as it is an exempt document pursuant to Paragraph 2.1 of Practice Note 18 of the Listing Requirements for the Main Market of Bursa Malaysia Securities Berhad. Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular/Statement and makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular/Statement.

MALAYSIA STEEL WORKS (KL) BHD (Company No.: 7878-V)

(Incorporated in Malaysia)

PART A

CIRCULAR TO SHAREHOLDERS

IN RELATION TO: PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY

TRANSACTIONS OF A REVENUE OR TRADING NATURE

PART B

STATEMENT TO SHAREHOLDERS IN RELATION TO:

PROPOSED RENEWAL OF AUTHORITY FOR THE COMPANY TO PURCHASE ITS OWN

ORDINARY SHARES Notice of the Company’s Forty-First Annual General Meeting to be held at Rebana Hall, Level 1, Convention Centre, Grand BlueWave Hotel Shah Alam, Persiaran Perbandaran, Seksyen 14, 40000 Shah Alam, Selangor Darul Ehsan on Thursday, 27 June 2013 at 3.00 p.m. together with a Form of Proxy are enclosed together with the Annual Report 2012 of the Company. If you are unable to attend and vote at the meeting, please complete and return the Form of Proxy in accordance with the instructions therein as soon as possible so as to arrive at the Company’s Share Registrar office at Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not later than 48 hours before the time set for holding the meeting. The lodging of the Proxy Form will not preclude you from attending and voting in person at the meeting should you subsequently wish to do so. Last date and time for lodging the Form of Proxy: 25 June 2013 before 3.00 p.m.

This Circular/Statement is dated 4 June 2013

MASTEEL

1




PART A




PART B





MASTEEL

1




PART A




PART B





MASTEEL

1




PART A




PART B





1

MASTEEL

2












given in section 6A of the CA. NA : Net assets attributable to ordinary equity holders of the Company. MASTEEL

2












given in section 6A of the CA. NA : Net assets attributable to ordinary equity holders of the Company.

2

MASTEEL

2













MASTEEL

3

DEFINITIONS (Cont’d) Proposed RRPT Mandate : Proposed renewal of shareholders’ mandate for Recurrent Related Party

Transactions for the Group to enter into the transactions set out in paragraph 3.4 of this Circular with Related Parties.

Proposed Share Buy-Back : Proposed purchase by MASTEEL of its own Shares on Bursa Securities of not more than ten percent (10%) of the issued and paid-up share capital of MASTEEL. Related Party or Related Parties : Director, Major Shareholder or persons connected with such Director or

Major Shareholder. Related Party Transaction : Transactions entered into by the Company and/or its subsidiaries which

involves the interest, direct or indirect, of a Related Party. Recurrent Related Party : Recurrent related party transactions of a revenue or trading nature which are Transaction or RRPT necessary for the day-to-day operations of the Company and its subsidiaries and in the ordinary course of business and are on normal commercial terms not more favourable to the Related Party than those generally available to the public and are not to the detriment of the minority shareholders of the Company. RRPT Mandate : Shareholders’ mandate for the Company and its subsidiaries to enter into

Recurrent Related Party Transactions. RM : Ringgit Malaysia Shares : Ordinary shares of RM0.50 each in the Company Words incorporate the singular shall, where applicable, include the plural and vice versa and words incorporate the masculine gender shall, where applicable, include the feminine and neuter genders and vice versa. Reference to persons shall include a corporation, unless otherwise specified. Any reference in this Circular/Statement to any enactment is a reference to that enactment as for the time being amend or re-enacted. Any reference to a time of a day in this Circular/Statement shall be a reference to Malaysian time, unless otherwise stated.

The rest of this page has been intentionally left blank

3

MASTEEL

2













MASTEEL 4

TABLE OF CONTENTS

PART A: CIRCULAR TO SHAREHOLDERS IN RELATION TO THE PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE

DIRECTORS’ LETTER TO THE SHAREHOLDERS CONTAINING: Page 1. INTRODUCTION 7 2. APPROVAL REQUIRED 8

3. DETAILS OF PROPOSED RRPT MANDATE 8

3.1 Part E, Paragraph 10.08 and 10.09 of the Listing Requirements 8 3.2 Shareholders’ RRPT Mandate 9 3.3 Class of Related Party 9 3.4 Nature of RRPT and Estimated Annual Value 10 3.5 Nature and Extent of Interest 10 3.6 Rationale for, and the benefit to, the Group for transacting with the Mandated Related Party 10 3.7 Review Methods or Procedures for Related Party Transactions 11 3.8 Audit Committee’s Statement 12

3.9 Estimated Value and the Actual Value of the RRPT based on the Existing Mandate 12 3.10 Amount due from the Mandated Related Party 12

4. INTEREST OF DIRECTORS AND MAJOR SHAREHOLDERS 13

4.1 Interested Directors’ shareholdings based on the Register of Directors’ Shareholdings as at 13 10 May 2013 4.2 Interested Major Shareholders’ shareholdings based on the Register of Substantial Shareholders’ Shareholdings as at 10 May 2013 13 4.3 Statements in relation to Interested Parties 13

5. DIRECTORS’ RECOMMENDATION 14

6. ANNUAL GENERAL MEETING 14

7. FURTHER INFORMATION 14

PART B: STATEMENT TO SHAREHOLDERS IN RELATION TO THE PROPOSED RENEWAL OF AUTHORITY FOR THE COMPANY TO PURCHASE ITS OWN SHARES

1. INTRODUCTION 16

2. DETAILS OF THE PROPOSED SHARE BUY-BACK 16

2.1 General 16 2.2 Actual Share Buy-Back 17 2.3 Funding 17 2.4 Treatment of the Shares Purchased 17 2.5 Purchase Price 17 2.6 Resale Price 17

3. RATIONALE AND POTENTIAL ADVANTAGE OF THE PROPOSED SHARE BUY-BACK 18

4

MASTEEL

2













MASTEEL

5

TABLE OF CONTENTS (Cont’d) Page 4. POTENTIAL DISADVANTAGE OF THE PROPOSED SHARE BUY-BACK 18 5. FINANCIAL EFFECTS OF THE PROPOSED SHARE BUY-BACK 18

5.1 Share Capital 18 5.2 Working Capital 19 5.3 Earnings 19 5.4 NA per Share 20 5.5 Dividends 20

6. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS 20 7. PUBLIC SHAREHOLDING SPREAD 20 8. MALAYSIAN CODE ON TAKE-OVERS AND MERGERS 20 9. DIRECTORS’ RECOMMENDATION 21 10. FURTHER INFORMATION 21 APPENDIX 1 – FURTHER INFORMATION 1. RESPONSIBILITY STATEMENT 22 2. MATERIAL LITIGATON 22 3. MATERIAL CONTRACTS 22 4. DOCUMENTS FOR INSPECTION 22 APPENDIX 2 1. DIRECTORS’ SHAREHOLDINGS 23 2. SUBSTANTIAL SHAREHOLDERS’ SHAREHOLDINGS 24

5

MASTEEL

2













MASTEEL

6

PART A

CIRCULAR TO SHAREHOLDERS IN RELATION TO:-

PROPOSED RENEWAL OF

SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY


MASTEEL

6

PART A

CIRCULAR TO SHAREHOLDERS IN RELATION TO:-

PROPOSED RENEWAL OF

SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY


6

MASTEEL

2













MASTEEL

7

MALAYSIA STEEL WORKS (KL) BHD

www.masteel.com.my (Company No.: 7878-V)


Registered Office: Unit B-05-3A, 5th Floor

Block B (West Wing), PJ8 Office Suite No. 23, Jalan Barat, Seksyen 8

46050 Petaling Jaya Selangor Darul Ehsan

4 June 2013 Board of Directors: DATO’ IKHWAN SALIM BIN DATO’ HAJI SUJAK (Independent Non-Executive Chairman) DATO’ SRI TAI HEAN LENG @ TEK HEAN LENG (Managing Director / Chief Executive Officer) LEE KEAN BINH (Executive Director) LAU YOKE LEONG (Executive Director) LIM HOO TECK (Independent Non-Executive Director) NG WAH LOK (Independent Non-Executive Director) MUHAMMAD HANIZAM BIN HJ. BORHAN (Independent Non-Executive Director) To: The Shareholders of MASTEEL Dear Sir/Madam, PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE 1. INTRODUCTION

On 28 June 2012, the Company had obtained shareholders’ approval for a general mandate for the Group to enter into RRPT in the ordinary course of business of a revenue or trading nature which are necessary for the day-to-day operations of the Group based on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and which are not to the detriment of the minority shareholders of the Company. The actual value of the RRPT transacted, from 28 June 2012 up to the latest practicable date before printing of this Circular is as stated in paragraph 3.9 of this Circular. The said existing mandate for RRPT shall lapse at the conclusion of the forthcoming AGM unless its renewal is obtained from the shareholders at the forthcoming AGM.

MASTEEL

7









MASTEEL

7









7

MASTEEL

2













MASTEEL

8

The Board proposes to seek the approval of shareholders for the renewal of the RRPT Mandate for the Group in its normal course of business, to enter into transactions set out in paragraph 3.4 below with Related Parties. The Company had on 25 April 2013 made the announcement to Bursa Securities pertaining to the above-mentioned Proposed RRPT Mandate.

2. APPROVAL REQUIRED

The purpose of this Circular is to provide shareholders with details pertaining to the Proposed RRPT Mandate and to seek shareholders’ approval for the resolution to be tabled at the forthcoming AGM to be convened on Thursday, 27 June 2013 at 3.00 p.m. at Rebana Hall, Level 1, Convention Centre, Grand BlueWave Hotel Shah Alam, Persiaran Perbandaran, Seksyen 14, 40000 Shah Alam, Selangor Darul Ehsan.

3. DETAILS OF THE PROPOSED RRPT MANDATE 3.1 Part E, Paragraph 10.08 and 10.09 of the Listing Requirements

The details of the RRPT pursuant to Part E, Paragraph 10.09, which should be read in conjunction with Paragraph 10.08 of the Listing Requirements to be dealt with at the forthcoming AGM, are as follows: Recurrent Related Party Transactions Under Part E, Paragraph 10.09(2) of the Listing Requirements, where related party transactions involving recurrent transactions of a revenue or trading nature which are necessary for its day-to-day operations such as supplies of materials within the Group with a related party, listed issuer may seek a shareholders’ mandate in respect of such transactions subject to the following:

(a) The transactions are in the ordinary course of business and are on terms not more favourable to the

related party than those generally available to the public; (b) The shareholders’ mandate is subject to annual renewal and disclosure is made in the annual report of

the aggregate value of transactions conducted pursuant to the shareholders’ mandate during the financial year where the aggregate value is equal to or exceeds the applicable prescribed threshold under paragraph 10.09(1) of the Listing Requirements, specifically:

(i) in relation to a listed issuer with an issued and paid-up capital of RM60 million and above -

• the consideration, value of the assets, capital outlay or costs of the Recurrent Related Party Transactions is RM1 million or more; or

• the percentage ratio of such Recurrent Related Party Transaction is 1% or more, whichever is the higher; or

(ii) in relation to a listed issuer with an issued and paid-up capital which is less than RM60 million -

• the consideration, value of the assets, capital outlay or costs of the Recurrent Related Party Transaction is RM1 million or more; or

• the percentage ratio of such Recurrent Related Party Transaction is 1% or more, whichever is the lower;

(c) Issuing of Circular to shareholders by the listed issuer which includes information as may be prescribed

by Bursa Securities (which shall include the information set out in Annexure PN12-A of Practice Note No. 12). The draft Circular must be submitted to Bursa Securities together with a checklist showing compliance with the said Annexure PN12-A of Practice Note No. 12;

(d) In a meeting to obtain shareholders’ mandate, the interested directors, interested major shareholders or

interested persons connected with a director or major shareholder; and where it involves the interest of an interested person connected with a director or major shareholder, such director or major shareholder must not vote on the resolutions approving the transactions. An interested director or interested major shareholder must ensure that persons connected with him abstain from voting on the resolution approving the transactions; and

(e) the listed issuer immediately announces to Bursa Securities when the actual value of a Recurrent

Related Party Transaction entered into by the listed issuer, exceeds the estimated value of the Recurrent Related Party Transaction disclosed in the Circular by 10% or more and must include the information as may be prescribed by the Exchange in its announcement. MASTEEL

8




















Related Party Transaction entered into by the listed issuer, exceeds the estimated value of the Recurrent Related Party Transaction disclosed in the Circular by 10% or more and must include the information as may be prescribed by the Exchange in its announcement. MASTEEL

8




















Related Party Transaction entered into by the listed issuer, exceeds the estimated value of the Recurrent Related Party Transaction disclosed in the Circular by 10% or more and must include the information as may be prescribed by the Exchange in its announcement.

8

MASTEEL

2













MASTEEL

9

Where a listed issuer has obtained such a mandate, the requirements of Paragraph 10.08 of the Listing Requirements shall not apply to the recurrent transactions which are comprised in the mandate. Principal Business The principal activity of the Company is manufacturing of steel bars and steel billets. The principal activity of the Company’s subsidiary is: No Name of Company % Principal Activities 1. Metropolitan

Commuter Network Sdn Bhd

100 Supply and operation of rail linked assets.

3.2 Shareholders’ RRPT Mandate

The Board is seeking approval from shareholders for the Proposed RRPT Mandate, which shall be valid until either of the events in (a)-(c) below occurs first, which will allow the Company and its subsidiaries, in its normal course of business, to enter into the categories of RRPT referred to in paragraph 3.4 below, with the class of Mandated Related Party as set out in paragraph 3.3 below, provided that such transactions, if any, are made at arm’s length with the Company and its subsidiaries on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and are not to the detriment of the minority shareholders of the Company. The RRPT Mandate is subject to annual renewal and shall only continue to be in force until: (a) the conclusion of the next AGM of the Company following the forthcoming AGM of the Company at

which the Proposed RRPT Mandate will be tabled;

(b) the expiration of the period within which the next AGM of the Company after that date it is required to be held pursuant to Section 143(1) of the CA (but shall not extend to such extensions as may be allowed pursuant to Section 143(2) of the CA); or

(c) revoked or varied by resolution passed by the shareholders in general meeting, whichever is the earlier. Thereafter, shareholders’ approval for a renewal of the RRPT Mandate will be sought at each subsequent AGM of the Company.

3.3 Class of Related Party

The Proposed RRPT Mandate will apply to the following class of Related Party:

No. Mandated Related Party Place of Incorporation

Principal Activity

1. Soon Seng Co (Penang) Sdn Bhd

Malaysia Retailing of general hardware, petroleum products, cement based products, building material and transportation.

9

MASTEEL

2













MASTEEL

10

3.4 Nature of RRPT and Estimated Annual Value

The type of RRPT to be covered by the Proposed RRPT Mandate relates principally to the following and such transactions are necessary for the day-to-day operations and are in the ordinary course of business of the Company and its subsidiaries:-

No.

Type of Transactions

Mandated Related Party

Interested Director,

Major Shareholder and Person Connected

Estimated value during the validity period of the RRPT Mandate from 27

June 2013 to the next AGM

(RM’000)

Charged by


Charged

to Mandated

Related Party

1. Purchase of the following:- - scrap metal - diesel/ petroleum products - galvanized colour sheet & coils

Soon Seng Co (Penang) Sdn Bhd

• Dato Sri Tai Hean Leng @ Tek Hean Leng • TYY Resources Sdn Bhd • Datin Ng Pik Lian • Lee Kean Binh • Lau Yoke Leong • Tay Kwok Peng (Administrator of the Estate of Tai Chet Siang)

10,000 -

Note:

The estimated value of the transactions during the validity period of the RRPT Mandate are based on the information available at the point of estimation based on the projection of the business to be conducted in the coming year after taking into consideration the prevailing market rates. Due to the nature of the transactions, the actual value of the transactions may vary from the estimated value disclosed above. The frequency of the transactions cannot be detailed as the transactions are ongoing and numerous.

3.5 Nature and Extent of Interest

The nature and extent of the interest of the interested Directors, Major Shareholders and persons connected to them as stated in the preceding table are as follows:

(a) TYY Resources Sdn Bhd is a Major Shareholder holding 30.93% direct shareholding in MASTEEL as at 10

May 2013. (b) TYY Resources Sdn Bhd is a major shareholder in Soon Seng Co (Penang) Sdn Bhd. (c) Dato’ Sri Tai Hean Leng @ Tek Hean Leng, Datin Ng Pik Lian and Tay Kwok Peng (Administrator of the

Estate of Tai Chet Siang) are major shareholders in TYY Resources Sdn Bhd. (d) Dato’ Sri Tai Hean Leng @ Tek Hean Leng is the son of Datin Ng Pik Lian. (e) Dato’ Sri Tai Hean Leng @ Tek Hean Leng, Lee Kean Binh and Lau Yoke Leong are Directors of TYY

Resources Sdn Bhd. 3.6 Rationale for, and the benefit to, the Group for transacting with the Mandated Related Party

The Company’s relationship with the Mandated Related Party The Company has a long-standing business relationship of more than 10 years with the Mandated Related Party. The Mandated Related Party is a good customer of the Company as well as a reliable supplier of raw materials, goods and services required by the Company for its businesses. The raw materials and goods provided by the Mandated Related Party is priced competitively and all transactions between the Company and the Mandated MASTEEL

10



No.







(RM’000)

Charged by


Charged

to Mandated

Related Party




10,000 -

Note:








The Company’s relationship with the Mandated Related Party The Company has a long-standing business relationship of more than 10 years with the Mandated Related Party. The Mandated Related Party is a good customer of the Company as well as a reliable supplier of raw materials, goods and services required by the Company for its businesses. The raw materials and goods provided by the Mandated Related Party is priced competitively and all transactions between the Company and the Mandated MASTEEL

10



No.







(RM’000)

Charged by


Charged

to Mandated

Related Party




10,000 -

Note:








The Company’s relationship with the Mandated Related Party The Company has a long-standing business relationship of more than 10 years with the Mandated Related Party. The Mandated Related Party is a good customer of the Company as well as a reliable supplier of raw materials, goods and services required by the Company for its businesses. The raw materials and goods provided by the Mandated Related Party is priced competitively and all transactions between the Company and the Mandated

10

MASTEEL

2













MASTEEL

11

Related Party are carried out at arm’s length basis and on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and are not to the detriment of the minority shareholders of the Company. The raw materials, goods and services can also be obtained from the Mandated Related Party even when short notice is given to them, in order to meet the tight deadlines of the Company’s business. Although the Company also sources similar raw materials, goods and services from third parties, the Company would like to seek shareholders’ approval for the Proposed RRPT Mandate as the close co-operation between the Company and the Mandated Related Party has reaped mutual benefits and has been and is expected to continue to be of benefit to the businesses of the Company. Further, the Company can enjoy the lowest cost through bulk purchase arrangement and obtain the materials at short notice while maintaining the prevailing market prices. The benefit of the RRPT Mandate The obtaining of the RRPT Mandate and the renewal of the RRPT Mandate on an annual basis would eliminate the need to convene separate general meetings from time to time to seek shareholders’ approval as and when the potential RRPT with a Mandated Related Party arise, thereby reducing substantially administrative time and expenses in convening such meetings, without compromising the corporate objectives and/or adversely affecting the business opportunities available to the Company. The RRPT Mandate is intended to facilitate transactions in the normal course of business of the Company which are transacted from time to time with the Mandated Related Party, provided that they are carried out at arm’s length and on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and are not to the detriment of the minority shareholders of the Company.

3.7 Review Methods or Procedures for Related Party Transactions

The Company implements the following procedures to supplement existing internal procedures for general transactions to ensure that the RRPT are undertaken on arm’s length basis and on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and are not to the detriment of the minority shareholders of the Company:- (i) The name of the Mandated Related Party will be circulated to the Company’s subsidiaries to notify

them that all RRPT are required to be undertaken at arm’s length basis and on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and are not to the detriment of the minority shareholders.

(ii) Where the RRPT is one with a value equal to or in excess of RM1.0 million, it will be reviewed and

approved by the Directors of the Company who have no interest in the transaction. Where the RRPT is one with a value below RM1.0 million, it will be reviewed and approved by a management committee comprising of at least one (1) executive director and two (2) senior management staff.

For the purpose of RRPT procurement only, senior management staff will be taken to mean the following: Managing Director / Chief Executive Officer, Executive Director, Vice Presidents, Operations Manager and the Senior Vice President Finance.

(iii) The annual internal audit plan shall incorporate a review of all RRPT entered into pursuant to the RRPT Mandate to ensure that the relevant approvals have been obtained and the review procedures in respect of such transactions are adhered to.

(iv) The Board and the Audit Committee shall review the internal audit reports to ascertain that the

guidelines and procedures established to monitor RRPT have been complied with and the review shall be done annually together with the review of annual results.

(v) The Board and the Audit Committee have reviewed the procedures and shall continue to review the

procedures as and when required, with the authority to sub delegate to individuals or committees within the Company as they deem appropriate.

(vi) Quotations will be taken from at least 2 other contemporaneous unrelated third parties to compare the

prices quoted by third parties and Mandated Related Party for the purpose of determining the competitive market price of raw materials and goods. It is our policy to purchase raw materials or goods from Mandated Related Party when the prices are competitive with prices obtained from third parties and that the prices for the RRPTs are not detrimental to the Group. Other factors such as reliability of supply, delivery, services and quality of raw materials or goods will also be taken into

MASTEEL

11















MASTEEL

11















MASTEEL

11

Related Party are carried out at arm’s length basis and on normal commercial terms not more favourable to the Mandated Related Party than those generally available to the public and are not to the detriment of the minority shareholders of the Company. The raw materials, goods and services can also be obtained from the Mandated Related Party even when short notice is given to them, in order to meet the tight deadlines of the Company’s business. Although the Company also sources similar raw materials, goods and services from third parties, the Company would like to seek shareholders’ approval for the Proposed RRPT Mandate as the close co-operation between the Company and the Mandated Related Party has reaped mutual benefits and has been and is expected to continue to be of benefit to the businesses of the Company. Further, the Company can enjoy the lowest cost through bulk purchase arrange

Documents

MALAYSIA STEEL WORKS (KL) BHDcontent.investor.net.my/wp-content/uploads/Masteel...Company or MASTEEL : Malaysia Steel Works (KL) Bhd (Company No.: 7878-V) CA : Companies Act, 1965