| Type | Announcement | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Subject | OTHERS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Description | DIGI.COM BERHAD ("DIGI" OR "THE COMPANY") - ENTRY INTO SHAREHOLDERS AGREEMENT IN RELATION TO THE IMPLEMENTATION PROGRAMME FOR THE ENTRY POINT PROJECT ENTITLED “REGIONAL NETWORK” |
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1. INTRODUCTION
We wish to announce that DiGi Telecommunications Sdn Bhd (“DiGi Tel”), a wholly-owned subsidiary of the Company, had on 25 April 2011 entered into a Shareholders Agreement with twenty-three (“23”) other parties specifically named in Schedule A in the table below (“Parties” or “Shareholders”), (“Shareholders Agreement”), to form a consortium under the name of KONSORTIUM RANGKAIAN SERANTAU SDN BHD (formerly known as My Regional Network Company Sdn Bhd) (“Consortium”).
The Consortium is formed for the purpose of implementing one of the entry points project (“EPP”) entitled “Regional Network” to lower the costs of IP Transit and domestic bandwidth by the aggregation of capacity (as a form of buying power) of the Shareholders to secure lower prices from suppliers.
2.0 SALIENT POINTS OF THE SHAREHOLDERS AGREEMENT The salient points of the Shareholders Agreement are as follows: 2.1 Business of the Consortium (a) The Consortium’s business to be undertaken is to:
(i) procure bandwidth capacity from suppliers (who may be either a Shareholder or third parties) for both domestic backhaul and international segment. The bandwidth capacity is to be from cable landing stations in Malaysia to Metro Points of Presence (“PoPs”) and from Metro PoPs to other Metro PoPs only; and
(ii) supply bandwidth capacity to Shareholders only.
(b) The Consortium shall, subject to the feasibility study, and approval of Shareholders and Government of Malaysia, invest in the international submarine cable system and a cable landing station that will form part of the Consortium’s infrastructure. 2.2 Capital Structure
The authorised share capital of the Consortium shall be Ringgit Malaysia Ten Million (RM10,000,000) divided into Ten Million (10,000,000) ordinary shares of RM1.00 each and may be increased from time to time in accordance with the Memorandum and Articles of Association of the Consortium.
The initial issued and paid-up share capital of the Consortium is Ringgit Malaysia Two Hundred and Forty Thousand (RM240,000) comprising Two Hundred and Forty Thousand (240,000) ordinary shares of RM1.00 each, of which each party holds an equivalent of 10,000 shares of RM1.00 each issued at par value in the Consortium. The Parties also have agreed to commit an additional capital contribution in cash of RM40,000 each by subscribing 40,000 ordinary shares of RM1.00 each, at such later time as may be determined by the Consortium’s Board of Directors. The total subscription consideration will amount to RM50,000 only.
3.0 RATIONALE FOR PARTICIPATING IN THE CONSORTIUM DiGi Tel’s participation in the Consortium is in support of the Government of Malaysia’s initiative under the Economic Transformation Programme (“ETP”), which will enable additional IP transit and domestic bandwidth capacity to be available in Malaysia at a lower cost, which enables Consortium members to enjoy lower bandwidth cost. This will consequently benefit the consumers in terms of price and experience for internet and broadband services.
4.0 FINANCIAL EFFECT
4.1 Share Capital The Shareholders Agreement would not have any effect on the issued and paid-up share capital of DiGi.
4.2 Earnings and Net Assets
The Shareholders Agreement is not expected to have any material impact to the earnings and net assets of the DiGi Group for the financial year ending 31 December 2011. 5.0 APPROVALS REQUIRED The Shareholders Agreement is not subject to any shareholder or government authorities’ approval.
6.0 DIRECTORS' AND MAJOR SHAREHOLDERS’ INTEREST None of the Directors and major shareholders of DiGi and/or persons connected to them has any interest, whether direct or indirect, in the Shareholders Agreement. 7.0 DIRECTORS’ STATEMENT The Board of DiGi after having considered the rationale of the Shareholders Agreement is of the opinion that the Shareholders Agreement is in the best interest of DiGi. This is a voluntary announcement under Paragraph 10.05(2) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.
This announcement is dated 25 April 2011. SCHEDULE A: LIST OF OTHER SHAREHOLDERS
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| Company Name | DIGI.COM BERHAD |
| Stock Name | DIGI |
| Date Announced | 25 Apr 2011 |
| Category | General Announcement |
| Reference No | CC-110425-58977 |
