TAMADAM BONDED WAREHOUSE BERHAD (“TAMADAM” OR “COMPANY”)

I. PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN BRAHIM’S-LSG SKY CHEFS HOLDINGS SDN BHD (“BLH”) COMPRISING 510,000 ORDINARY SHARES OF RM1.00 EACH (“SHARES”) FOR A PURCHASE CONSIDERATION OF RM136.5 MILLION FROM BRAHIM’S INTERNATIONAL FRANCHISES SDN BHD (“BIF”) TO BE SATISFIED BY THE ISSUANCE OF 160,588,235 NEW SHARES IN TAMADAM VALUED AT RM0.85 PER SHARE (“PROPOSED BLH ACQUISITION”);

II. PROPOSED WAIVER TO BIF AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GENERAL OFFER (“GO”) FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN TAMADAM AND ALL NEW SHARES THAT MAY BE ALLOTED AND ISSUED PURSUANT TO THE EXERCISE OF THE COMPANY’S 2000/2010 WARRANTS (“WARRANTS”) AFTER THE PROPOSED BLH ACQUISITION (“PROPOSED WAIVER”);

III. PROPOSED OFFER FOR SALE AND/OR PLACEMENT OF SHARES IN TAMADAM HELD BY BIF TO THE MALAYSIAN PUBLIC (“PROPOSED OFFER FOR SALE AND/OR PLACEMENT”); AND

IV. PROPOSED INCREASE IN THE AUTHORISED SHARE CAPITAL OF TAMADAM FROM RM100,000,000 COMPRISING 100,000,000 SHARES TO RM500,000,000 COMPRISING 500,000,000 SHARES (“PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL”)

INTRODUCTION
On 28 June 2007, Tamadam announced that it had entered into a share sale agreement with BIF to acquire 51% equity interest in Brahim’s-LSG Sky Chefs Holdings Sdn Bhd comprising 510,000 ordinary shares of RM1.00 each for a purchase consideration of RM136.5 million to be satisfied by the issuance of 160,588,235 new Tamadam shares at an issue price of RM0.85 per share.

Tamadam has obtained the approval of the Securities Commission, in their letter dated 13 December 2007, for the following:

1. acquisition of 51% equity interest in BLH comprising 510,000 Shares from BIF for a purchase consideration of RM130.0 million to be satisfied by the issuance of 130.0 million new Shares in Tamadam;
2. offer for sale and/or placement of up to 11,394,750 Shares in Tamadam held by BIF to the Malaysian public; an
3. listing of and quotation for the 130.0 million new Shares in Tamadam to be issued pursuant to the Proposed Acquisition on the Second Board of Bursa Securities

Tamadam has also obtained the approval of the Equity Compliance Unit of the SC (“ECU“) for the Proposed Acquisition under the Guidelines on the Acquisition of Interests, Mergers and Take-Overs by Local and Foreign Interests issued by the Foreign Investment Committee via the same letter.

BASIS OF DETERMINING THE PURCHASE CONSIDERATION
The purchase consideration for the Proposed Acquisition of RM130.0 million was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the fair value of BLH and its subsidiary company, LSG Sky Chefs-Brahim’s Sdn Bhd (“LSGB“)(collectively referred to as “the BLH Group“) which was arrived at using the DCF methodology on the projected future cashflows of BLH and LSGB which is attributable to BLH.

Based on an independent valuation report on the BLH Group dated 13 September 2007 by Messrs Horwath (a chartered accounting firm), the BLH Group was valued to be between RM262.0 million and RM271.9 million using discount rates based on WACC of between 7.31% and 7.66%. Accordingly, the fair value for 51.0% equity interest in BLH ranges between RM133.6 million to RM138.7 million.

Accordingly, the purchase consideration for the Proposed Acquisition of RM130.0 million does not fall within the range of the valuation ascribed by Horwath and is below the lower end of the range of valuation ascribed by Horwath.

BACKGROUND INFORMATION ON BLH
BLH is principally an investment holding company. It commenced operations in December 2003 when it acquired its sole 70%-owned subsidiary, LSGB which is principally involved in the provision of in-flight catering and related services such as cabin handling.

LSGB’s HQ at KLIA

LSGB is also the principal in-flight catering service provider at both the KLIA and Penang Airport. As a global airline catering company, LSGB serves more than thirty international airlines. It operates 24 hours daily with an output of about 35,000 meals per day at the KLIA and more than 1,000 meals per day at the Penang Airport. LSGB prides itself on the preparation of 100% guaranteed halal meals and a fully integrated food logistics supply chain which includes coldrooms, warehouses and distribution support.

LSGB’s skylift and A380

LSGB has a catering agreement with MAS which was entered into on 25 September 2003, giving LSGB the exclusive right to supply and provide in-flight catering and cabin handling services to MAS at both the KLIA and Penang Airport for a period of twenty-five years expiring on 1 December 2028. Some of LSGB’s other clients are Japan Airlines, Cathay Pacific Airways, Korean Air, Air Asia, Thai Airways and Emirates Airlines.

LSGB’s catering trucks

In addition, LSGB also has a technical assistance agreement with LSG Asia entered into on 25 September 2003 (“Technical Assistance Agreement”) which basically entails the provision of various technical assistance by LSG Asia for the operations of LSGB for a period of twenty-five (25) years expiring on 1 December 2028. MAS holds the remaining 30% equity interest in LSGB.

LSGB kitchen

Based on the audited financial statements of the BLH Group for the FYE 31 December 2006, the net profits and net assets of the BLH Group are approximately RM13.0 million and RM23.69 million respectively.

PROSPECTS OF BLH AND THE ENLARGED TAMADAM GROUP
LSGB has plans within the next five years to venture into the business of high-end and industrial food catering services such as food catering for schools, colleges, and universities, event catering services and the provision of food catering services to convenience stores and eatery outlets, as a source of diversification into other areas of the food and hospitality industry whilst reducing its dependence on in-flight catering business.

CONDITIONS TO THE PROPOSALS
The Proposals are conditional upon the following :-

(a) the approval of the SC for the Proposed Acquisition, the Proposed Offer For Sale And/Or Placement and the listing of and quotation for the new Shares in Tamadam to be issued pursuant to the Proposed Acquisition which was obtained on 13 December 2007;

(b) the approval of the ECU for the Proposed Acquisition which was obtained on 13 December 2007;

(c) the approval of the SC for the Proposed Waiver;

(d) the approval of the shareholders of Tamadam at the forthcoming EGM, save for the Proposed Offer For Sale And/Or Placement;

(e) the approval in-principle from Bursa Securities for the listing of and quotation for the new Shares to be issued pursuant to the Proposed Acquisition; and

(f) the approvals, waivers and/or consents from any other relevant authorities and/or persons, if required.

EXPECTED COMPLETION DATE
At the date of writing (that is 1 January 2008), the Proposals are expected to be completed by 31 January 2008.

TAMADAM BONDED WAREHOUSE BERHAD (“TAMADAM” OR “COMPANY”)

I. PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN BRAHIM’S-LSG SKY CHEFS HOLDINGS SDN BHD (“BLH”) COMPRISING 510,000 ORDINARY SHARES OF RM1.00 EACH (“SHARES”) FOR A PURCHASE CONSIDERATION OF RM136.5 MILLION FROM BRAHIM’S INTERNATIONAL FRANCHISES SDN BHD (“BIF”) TO BE SATISFIED BY THE ISSUANCE OF 160,588,235 NEW SHARES IN TAMADAM VALUED AT RM0.85 PER SHARE (“PROPOSED BLH ACQUISITION”);

II. PROPOSED WAIVER TO BIF AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GENERAL OFFER (“GO”) FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN TAMADAM AND ALL NEW SHARES THAT MAY BE ALLOTED AND ISSUED PURSUANT TO THE EXERCISE OF THE COMPANY’S 2000/2010 WARRANTS (“WARRANTS”) AFTER THE PROPOSED BLH ACQUISITION (“PROPOSED BIF WAIVER”);

III. PROPOSED WAIVER TO TAMADAM AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GO FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN LSG SKY CHEFS-BRAHIM’S SDN BHD (“LSGB”), A 70%-OWNED SUBSIDIARY OF BLH, PURSUANT TO THE PROPOSED BLH ACQUISITION (“PROPOSED TAMADAM WAIVER”);

(ITEMS (II) AND (III) ARE TO BE COLLECTIVELY REFERRED TO AS “PROPOSED WAIVERS”)

IV. PROPOSED OFFER FOR SALE AND/OR PLACEMENT OF SHARES IN TAMADAM HELD BY BIF TO THE MALAYSIAN PUBLIC (“PROPOSED OFFER FOR SALE AND/OR PLACEMENT”); AND

V. PROPOSED INCREASE IN THE AUTHORISED SHARE CAPITAL OF TAMADAM FROM RM100,000,000 COMPRISING 100,000,000 SHARES TO RM500,000,000 COMPRISING 500,000,000 SHARES (“PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL”)

Further to the Company’s announcements dated 28 June 2007 and 13 September 2007 respectively, on behalf of the Company, AmInvestment Bank Berhad (formerly known as AmMerchant Bank Berhad) (a member of AmInvestment Bank Group) would like to announce that the applications on the Proposed Acquisition and the Proposed BIF Waiver have been submitted to the relevant authorities today for approval, save for the application on the Proposed Tamadam Waiver which will be submitted to the Securities Commission in due course.

This Announcement is dated 18 September 2007.

TAMADAM BONDED WAREHOUSE BERHAD (“TAMADAM” OR “COMPANY”)

I. PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN BRAHIM’S-LSG SKY CHEFS HOLDINGS SDN BHD (“BLH”) COMPRISING 510,000 ORDINARY SHARES OF RM1.00 EACH (“SHARES”) FOR A PURCHASE CONSIDERATION OF RM136.5 MILLION FROM BRAHIM’S INTERNATIONAL FRANCHISES SDN BHD (“BIF”) TO BE SATISFIED BY THE ISSUANCE OF 160,588,235 NEW SHARES IN TAMADAM VALUED AT RM0.85 PER SHARE (“PROPOSED BLH ACQUISITION”);

II. PROPOSED WAIVER TO BIF AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GENERAL OFFER (“GO”) FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN TAMADAM AND ALL NEW SHARES THAT MAY BE ALLOTED AND ISSUED PURSUANT TO THE EXERCISE OF THE COMPANY’S 2000/2010 WARRANTS (“WARRANTS”) AFTER THE PROPOSED BLH ACQUISITION (“PROPOSED BIF WAIVER”);

III. PROPOSED WAIVER TO TAMADAM AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GO FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN LSG SKY CHEFS-BRAHIM’S SDN BHD (“LSGB”), A 70%-OWNED SUBSIDIARY OF BLH, PURSUANT TO THE PROPOSED BLH ACQUISITION (“PROPOSED TAMADAM WAIVER”);

(ITEMS (II) AND (III) ARE TO BE COLLECTIVELY REFERRED TO AS “PROPOSED WAIVERS”)

IV. PROPOSED OFFER FOR SALE AND/OR PLACEMENT OF SHARES IN TAMADAM HELD BY BIF TO THE MALAYSIAN PUBLIC (“PROPOSED OFFER FOR SALE AND/OR PLACEMENT”); AND

V. PROPOSED INCREASE IN THE AUTHORISED SHARE CAPITAL OF TAMADAM FROM RM100,000,000 COMPRISING 100,000,000 SHARES TO RM500,000,000 COMPRISING 500,000,000 SHARES (“PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL”)

1. INTRODUCTION

On 28 June 2007, it was announced that the Company had on even date entered into the following agreements :-

(i) a share sale agreement between Tamadam and BIF (“BLH Agreement”) for the acquisition of 510,000 Shares in BLH (“BLH Sale Shares”) by Tamadam from BIF for an indicative purchase consideration of RM130.0 million (“BLH Indicative Purchase Consideration”) to be satisfied by the issuance of 152,941,177 new Shares in Tamadam valued at RM0.85 per Share; and

(ii) a share sale agreement between Tamadam and Dewina Host Holdings Sdn Bhd (“DHSB”) (“DHost Agreement”) for the acquisition of 127,500 Shares in DHost by Tamadam from DHSB for a purchase consideration of RM6.12 million to be satisfied by the issuance of 7,200,000 new Shares in Tamadam valued at RM0.85 per Share (“Proposed DHost Acquisition”).

(The Proposed BLH Acquisition and Proposed DHost Acquisition are to be collectively referred to as “Proposed Acquisitions”)

Further to that announcement, on behalf of the Company, AmInvestment Bank Berhad (formerly known as AmMerchant Bank Berhad) (a member of AmInvestment Bank Group) (“AmInvestment Bank”) would like to announce that after due deliberation, the parties to the DHost Agreement have today mutually agreed not to proceed with the Proposed DHost Acquisition and accordingly, the parties have mutually agreed to terminate the DHost Agreement. In view of this, the proposals to be undertaken will now comprise the following:-

1. Proposed BLH Acquisition;
2. Proposed BIF Waiver;
3. Proposed Tamadam Waiver;
4. Proposed Offer For Sale And/Or Placement; and
5. Proposed Increase in Authorised Share Capital.

(items (1) to (5) above to be collectively referred to as “Revised Proposals”).

The Board of Directors of Tamadam is of the view that the termination of the Proposed DHost Acquisition does not materially change the benefits to be derived by Tamadam from the proposals announced on 28 June 2007.

In the same announcement, it was also announced that the final purchase consideration for the Proposed BLH Acquisition shall be subject to a valuation to be conducted on the BLH Sale Shares (“Valuation”) by the independent valuer to be appointed by Tamadam. To this end, Tamadam had appointed Messrs Horwath (“Horwath”) to undertake the Valuation.

On behalf of the Company, AmInvestment Bank would like to announce that Horwath has completed the Valuation.

2. FINAL PURCHASE CONSIDERATION FOR THE PROPOSED BLH ACQUISITION

As stipulated in the BLH Agreement, in the event that the BLH Indicative Purchase Consideration does not fall within the valuation range as ascribed by Horwath in its valuation report, the parties to the BLH Agreement shall agree to first confer in good faith (on an urgent and immediate basis) whether to accept such valuation for the BLH Sale Shares and whether to agree on an increase or reduction in the BLH Indicative Purchase Consideration. If the parties agree to accept the increased or reduced BLH Indicative Purchase Consideration, such amount shall be treated for all intents and purposes as the BLH Indicative Purchase Consideration for purposes of submission to the Securities Commission (“Final Purchase Consideration”) and the number of the Tamadam Shares to be issued and allotted to BIF shall be adjusted accordingly.

In arriving at the fair value of the BLH group of companies (“BLH Group”), Horwath has adopted the discounted cash flow methodology on the projected future cashflows of BLH and LSGB which is attributable to BLH respectively. Based on Horwath’s valuation report dated 13 September 2007, the BLH Group was valued by Horwath to be between RM262.0 million and RM271.9 million. Therefore, Horwath has ascribed a fair value for 51.0% equity interest in BLH of between RM133.6 million and RM138.7 million.

The parties to the BLH Agreement have accepted the valuation for the BLH Group Shares prepared by Horwath. Based on the valuation range ascribed by Horwath for 51.0% equity interest in BLH, the Final Purchase Consideration has been fixed at RM136.5 million.

Accordingly, the number of new Shares in Tamadam to be issued pursuant to the Proposed BLH Acquisition has been revised from 152,941,177 Shares to 160,588,235 Shares.

3. EFFECTS OF THE REVISED PROPOSALS

The effects of the Revised Proposals have taken into consideration the Final Purchase Consideration for the Proposed BLH Acquisition of RM136.5 million and the revised number of new Shares in Tamadam to be issued pursuant to the Proposed BLH Acquisition of 160,588,235 Shares.

3.1 Share Capital

The revised effect of the Proposed BLH Acquisition on the share capital of Tamadam is set out in Table 1 of the Appendix of this Announcement.

The Proposed Waivers, the Proposed Offer For Sale And/Or Placement and the Proposed Increase In Authorised Share Capital do not have any effect on the issued and paid-up share capital of Tamadam.

3.2 Net Assets And Gearing

Based on the audited financial statements of the Tamadam group of companies (“Tamadam Group”) as at 31 December 2006 and on the assumption that the Proposed BLH Acquisition had been effected on that date, the revised effect of the Proposed BLH Acquisition on the net assets and gearing of the Tamadam Group are set out in Table 2 of the Appendix of this Announcement.

The Proposed Waivers, the Proposed Offer For Sale And/Or Placement and the Proposed Increase In Authorised Share Capital do not have any effect on the net assets and gearing of the Tamadam Group.

3.3 Earnings

On the assumption that the Proposed BLH Acquisition will be completed by end December 2007, the Tamadam Group is expected to incur a net loss of approximately RM24.0 million for the financial year ending 31 December 2007 which is primarily due to a “once-off” impairment of approximately RM24.1 million, being the difference between the value assigned to the new Tamadam Shares to be issued pursuant to the Proposed BLH Acquisition of RM0.85 and the par value of the Company’s Shares of RM1.00.

Notwithstanding this, barring unforeseen circumstances, the Proposed BLH Acquisition is expected to contribute positively to the future earnings of the Tamadam Group going forward since the BLH Group is already income-generating.

The Proposed Waivers, the Proposed Offer For Sale And/Or Placement and the Proposed Increase In Authorised Share Capital do not have any effect on the earnings of the Tamadam Group.

3.4 Substantial Shareholders’ Shareholdings

The revised effects of the Proposed BLH Acquisition and the Proposed Offer For Sale And/Or Placement on the substantial shareholders and their shareholdings in Tamadam are set out in Table 3 of the Appendix of this Announcement.

The Proposed Waivers and the Proposed Increase In Authorised Share Capital do not have any effect on the shareholdings of the substantial shareholders in Tamadam.

The Proposed BLH Acquisition will result in the introduction of a new controlling shareholder for Tamadam, namely BIF.

4. DOCUMENTS AVAILABLE FOR INSPECTION

The valuation report by Horwath with regard to the BLH Sale Shares will be made available for inspection at the registered office of Tamadam at Mezzanine Floor, 8A Jalan Sri Semantan Satu, Damansara Heights, 50490 Kuala Lumpur during normal business hours from Monday to Fridays (except public holidays) for a period of three (3) months from the date of this Announcement.

5. SUBMISSION TO SECURITIES COMMISSION

The submission to the Securities Commission in relation to the Revised Proposals was made on 18 September 2007.

This Announcement is dated 13 September 2007.

Download Appendix Tables (.doc format)

TAMADAM BONDED WAREHOUSE BERHAD (“TAMADAM” OR “COMPANY”)

I. PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN BRAHIM’S-LSG SKY CHEFS HOLDINGS SDN BHD (“BLH”) COMPRISING 510,000 ORDINARY SHARES OF RM1.00 EACH (“SHARES”) FOR AN INDICATIVE PURCHASE CONSIDERATION OF RM130.0 MILLION FROM BRAHIM’S INTERNATIONAL FRANCHISES SDN BHD (“BIF”) TO BE SATISFIED BY THE ISSUANCE OF 152,941,177 NEW SHARES IN TAMADAM VALUED AT RM0.85 PER SHARE (“PROPOSED BLH ACQUISITION”);

II. PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN DEWINA HOST SDN BHD (“DHOST”) COMPRISING 127,500 SHARES FOR A PURCHASE CONSIDERATION OF RM6.12 MILLION FROM DEWINA HOLDINGS SDN BHD (“DHSB”) TO BE SATISFIED BY THE ISSUANCE OF 7,200,000 NEW SHARES IN TAMADAM VALUED AT RM0.85 PER SHARE (“PROPOSED DHOST ACQUISITION”);

(ITEMS (I) AND (II) ARE TO BE COLLECTIVELY REFERRED TO AS “PROPOSED ACQUISITIONS”)

III. PROPOSED WAIVER TO BIF AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GENERAL OFFER (“GO”) FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN TAMADAM AND ALL NEW SHARES THAT MAY BE ALLOTED AND ISSUED PURSUANT TO THE EXERCISE OF THE COMPANY’S 2000/2010 WARRANTS (“WARRANTS”) AFTER THE PROPOSED ACQUISITIONS (“PROPOSED BIF WAIVER”);

IV. PROPOSED WAIVER TO TAMADAM AND PARTIES ACTING IN CONCERT WITH IT FROM THE OBLIGATION TO EXTEND A MANDATORY GO FOR ALL THE REMAINING SHARES NOT ALREADY OWNED BY THEM IN BLH AND LSG SKY CHEFS-BRAHIM’S SDN BHD (“LSGB”), A 70%-OWNED SUBSIDIARY OF BLH, PURSUANT TO THE PROPOSED BLH ACQUISITION (“PROPOSED TAMADAM WAIVER”);

(ITEMS (III) AND (IV) ARE TO BE COLLECTIVELY REFERRED TO AS “PROPOSED WAIVERS”)

V. PROPOSED OFFER FOR SALE AND/OR PLACEMENT OF SHARES IN TAMADAM HELD BY BIF TO THE MALAYSIAN PUBLIC (“PROPOSED OFFER FOR SALE AND/OR PLACEMENT”); AND

VI. PROPOSED INCREASE IN THE AUTHORISED SHARE CAPITAL OF TAMADAM FROM RM100,000,000 COMPRISING 100,000,000 SHARES TO RM500,000,000 COMPRISING 500,000,000 SHARES (“PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL”)

(ITEMS (I) TO (VI) TO BE COLLECTIVELY REFERRED TO AS “PROPOSALS”)

1. INTRODUCTION

Further to the Company’s announcements dated 11 May 2007 and 8 June 2007 on the Proposed Acquisitions, on behalf of the Company, AmInvestment Bank Berhad (formerly known as AmMerchant Bank Berhad) (a member of AmInvestment Bank Group) (“AmInvestment Bank”) would like to announce that on 28 June 2007, the Company has entered into the following agreements for purposes of the Proposed Acquisitions :-

(a). A share sale agreement between Tamadam and BIF for the acquisition of 510,000 Shares in BLH (“BLH Sale Shares”) by Tamadam from BIF for an indicative purchase consideration of RM130.0 million to be satisfied by the issuance of 152,941,177new Shares in Tamadam valued at RM0.85 per Share (“BLH Agreement”); and

(b). A share sale agreement between Tamadam and DHSB for the acquisition of 127,500 Shares in DHost (“DHost Sale Shares”) by Tamadam from DHSB for a purchase consideration of RM6.12 million to be satisfied by the issuance of 7,200,000 new Shares in Tamadam valued at RM0.85 per Share (“DHost Agreement”).

(The BLH Agreement and DHost Agreement are to be collectively referred to as “Agreements”)

2. PROPOSED BLH ACQUISITION

2.1 Background Information On The Proposed BLH Acquisition

Pursuant to the terms of the BLH Agreement, the Company shall purchase 510,000 Shares in BLH, representing 51% of its issued and paid-up share capital, for an indicative purchase consideration of RM130.0 million to be satisfied by the issuance of 152,941,177new Shares in Tamadam valued at RM0.85 per Share.

The final purchase consideration for the Proposed BLH Acquisition shall be subject to a valuation to be conducted on the BLH Sale Shares by an independent valuer to be appointed by Tamadam (“Valuation”).

2.2 Salient Terms Of The BLH Agreement

The salient terms of the BLH Agreement are as follows :-

(a) Acquisition of the BLH Sale Shares

Subject to the terms and conditions of the BLH Agreement, BIF shall sell and Tamadam shall purchase all, and not some only, of the BLH Sale Shares in consideration of the 152,941,177new Shares in Tamadam valued at RM0.85 per Share and on the terms and conditions set out in the BLH Agreement free from all liens, claims, charges, mortgages, equities and other encumbrances whatsoever, but with all rights and advantages attaching thereto or accruing thereon together with all dividends (including dividends declared and but not paid) as at a date to be mutually agreed between BIF and Tamadam falling within fourteen (14) days from the date that the last of the conditions precedent set out in Section 2.2(c) of this Announcement have been fulfilled or waived (“BLH Completion Date”).

The parties acknowledge that BIF and Tamadam have agreed to sell and to purchase the BLH Sale Shares respectively, on the express basis that Tamadam shall execute a deed of accession to the Shareholders’ Agreement dated 25 September 2003 entered into between BIF, BLH and LSG Asia GmbH (“LSG Asia”) (“Shareholders’ Agreement”), wherein Tamadam agrees to be bound by the Shareholders’ Agreement as if it was the original party to the Shareholders’ Agreement, and for such deed to take effect at the BLH Completion Date.

(b) Purchase Consideration

(i). The indicative purchase consideration for the BLH Sale Shares shall be RM130.0 million to be satisfied by the issuance of 152,941,177 new Shares in Tamadam valued at RM0.85 per Share subject to the Valuation (“BLH Indicative Purchase Consideration”).

(ii). The BLH Indicative Purchase Consideration shall be subject to the Valuation and subject to the approval of the Securities Commission (“SC”). In the event that the BLH Indicative Purchase Consideration does not fall within the range of valuation on the BLH Sale Shares as specified by the independent valuer in its valuation report, the parties agree to first confer in good faith (on an urgent and immediate basis) whether to accept such valuation for the BLH Sale Shares and whether to agree on an increase or reduction in the BLH Indicative Purchase Consideration. If the parties agree to accept the increased or reduced BLH Indicative Purchase Consideration, such amount shall be treated for all intents and purposes as the BLH Indicative Purchase Consideration for purposes of submissions to the SC and the number of the Tamadam Shares to be issued and allotted to BIF shall be adjusted accordingly.

(iii). In the event that the SC imposes conditions such that the valuation of the BLH Sale Shares would affect the number of the new Tamadam Shares to be issued or the BLH Indicative Purchase Consideration, as the case may be, by less than five percent (5%) (“Revised Consideration”), the Revised Consideration for the BLH Sale Shares shall be deemed to have been accepted by both BIF and Tamadam and the number of the Tamadam Shares to be issued and allotted to BIF shall be adjusted accordingly.

(iv). The BLH Indicative Purchase Consideration shall be the final purchase consideration if the SC’s approved valuation of the BLH Sale Shares, subject always to item 2.2(b)(iii) above :-

(aa). falls within the range of valuation on the BLH Sale Shares as specified by the independent valuer in the valuation report;  and

(bb). there has been no change in the number of the Tamadam Shares to be issued required by the SC.

(v) In the event that item 2.2(b)(iii) above cannot be fulfilled or the SC imposes conditions that may affect the BLH Indicative Purchase Consideration or the RM0.85 value of the new Tamadam Shares to be issued by more than five percent (5%) :-

(aa) the parties agree to first confer in good faith (on an urgent and immediate basis) whether to accept or not such revised purchase consideration for the BLH Sale Shares or such revised number of the Tamadam Shares to be issued and allotted to BIF; and

(bb) if any party does not so accept, then the provisions of Clauses 4.2(b), 4.2(c), 4.5 and 4.6 of the BLH Agreement shall, mutatis mutandis, take effect.

(c) Conditions Precedent

The completion of the BLH Agreement is conditional upon the following conditions being satisfied on or before the day falling eight (8) months after the execution of the BLH Agreement, or such extended date as the parties may agree to in writing :-

(i) the conditions as set out in Section 12 of this Announcement;

(ii) Tamadam being reasonably satisfied, in accordance with Clause 3.2 of the BLH Agreement, with the results of the due diligence review of BLH, LSGB and their respective assets and businesses;

(iii) a valuation on the BLH Sale Shares has been conducted by an independent valuer to be appointed by Tamadam;

(iv) receipt of the formal consent of LSG Asia under the Shareholders’ Agreement to the sale and purchase transaction contemplated under the BLH Agreement including a waiver to the right granted to LSG Asia under the Shareholders’ Agreement to receive an offer in writing to purchase the BLH Sale Shares and a written affirmation that it would not be accepting a take-over offer, if such a take-over offer is made;

(v) receipt of the formal consent of Malaysian Airline System Berhad (“MAS”) under the Shareholders’ Agreement dated 25 September 2003 entered into between BLH, LSGB and MAS (“Subsidiary’s Shareholders’ Agreement”) to the sale and purchase transaction contemplated under the BLH Agreement including a confirmation from MAS that such sale and purchase transaction does not constitute a breach under the Subsidiary’s Shareholders’ Agreement and that the Subsidiary’s Shareholders’ Agreement shall be deemed amended with effect from the BLH Completion Date and a written affirmation that MAS would not be accepting a take-over offer, if such a take-over offer is made;

(vi) any other consents or approvals required in respect of the business and operations of BLH and/or LSGB from relevant Malaysian or international regulatory authorities or statutory bodies or which are otherwise found to be required during the course of the due diligence review;

(vii) where any party to the BLH Agreement by any law or regulation requires the approval of its shareholders for the sale and purchase transaction contemplated under the BLH Agreement, such shareholders’ approval;

(viii) the approval of the shareholders of BIF for the sale and purchase transaction contemplated under the BLH Agreement;

(ix) the approval of the Board of Directors (“Board”) of Tamadam for an increase in the authorised share capital of Tamadam and the sale and purchase transaction contemplated under the BLH Agreement; and

(x) the approval of the Board of BIF for the sale and purchase transaction contemplated under the BLH Agreement.

2.3 Background Information On BLH

BLH was incorporated in Malaysia under the Companies Act, 1965 (“Act”) as a private limited company on 18 June 2002. As at 31 May 2007, the authorised share capital of BLH is RM5,000,000 comprising 4,990,000 Shares and 1,000,000 redeemable preference shares of RM0.01 each (“RPS”), of which 1,000,000 Shares have been issued and are fully paid-up. As at 31 May 2007, the shareholders of BLH are BIF and LSG Asia holding 51% and 49% of the equity interest in BLH respectively.

BLH is principally an investment holding company. It commenced operations in December 2003 when it acquired its sole 70%-owned subsidiary, LSGB which is principally involved in the provision of in-flight catering and its related services such as cabin handling and is the principal in-flight catering service provider at both the Kuala Lumpur International Airport (“KLIA”) and Penang airport. As a global airline catering company, LSGB serves more than thirty (30) international airlines. It operates 24 hours daily with an output of 40,000 meals per day. BLH prides on the preparation of 100% guaranteed halal meals and a fully integrated food logistics supply chain which includes coldrooms, warehouses and distribution support.

LSGB has a catering agreement with MAS which was entered into on 25 September 2003 giving LSGB the exclusive right to supply and provide in-flight catering and cabin handling services to MAS at both the KLIA and Penang airport for a period of twenty-five (25) years until 2028. Some of LSGB’s other major clients are Japan Airlines, Cathay Pacific, Korean Air, Air Asia and Thai Airways.

In addition, LSGB also has a technical assistance agreement with LSG Asia which was entered into on 25 September 2003 and basically entails the provision of various technical assistance by LSG Asia for the operations of LSGB for a period of twenty-five (25) years until 2028. MAS holds the remaining 30% equity interest in LSGB.

Based on the audited consolidated financial statements of BLH for the financial year ended (“FYE”) 31 December 2006, the net profits and net assets of the BLH group of companies (“BLH Group”) are approximately RM7.199 million and RM23.688 million respectively.

The historical financial information of the BLH Group is set out in Table 1(A) of the Appendix of this Announcement.

2.4 Background Information On BIF

BIF was incorporated in Malaysia under the Act as a private limited company on 19 April 1994.

The principal activity of BIF is investment holding.

As at 31 May 2007, the directors of BIF are Datuk Ibrahim bin Haji Ahmad, Tan Sri Dato’ Mohd Ibrahim bin Mohd Zain and Datin Aminah binti Haji Ahmad. The substantial shareholders of BIF and their shareholdings in BIF are set out in Table 2 of the Appendix of this Announcement.

2.5 Basis Of Arriving At The Indicative Purchase Consideration

The indicative purchase consideration for the Proposed BLH Acquisition of RM130.0 million was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the adjusted net asset value of BLH after adjusting for the indicative valuation of its 70% equity interest in LSGB using the discounted cashflow methodology.

The final purchase consideration for the Proposed BLH Acquisition will be subject to the Valuation.

2.6 Basis Of Determining The Issue Price For The New Tamadam Shares

The issue price for the new Tamadam Shares of RM1.00 per Share was arrived at based on the par value of Tamadam Shares.

2.7 Basis Of Determining The Value Of The New Tamadam Shares

The new Tamadam Shares has been valued at RM0.85 per Share which was arrived at after taking into consideration the following :-

(i) the 5-day, 1-month and 3-month weighted average market price (“WAP”) of Tamadam Shares up to and including 10 May 2007, being the last market day prior to the announcement on the Proposed Acquisitions on 11 May 2007, of RM0.74, RM0.71 and RM0.74 respectively; and

(ii) the audited consolidated net assets per Share of Tamadam as at 31 December 2006 of RM0.55.

The 5-day WAP of Tamadam Shares up to and including 27 June 2007, being the last market day prior to this Announcement was RM1.25.

2.8 Ranking Of The New Tamadam Shares

The new Tamadam Shares to be issued pursuant to the Proposed BLH Acquisition shall, upon allotment and issue, rank pari passu in all respects with the existing issued Shares of Tamadam.

2.9 Shares Acquired Free From Encumbrances

The BLH Sale Shares shall be acquired free from all liens, claims, charges, mortgages, equities and other encumbrances whatsoever, but with all rights and advantages attaching thereto or accruing thereon together with all dividends (including dividends declared and but not paid) as at the BLH Completion Date.

2.10 Liabilities To Be Assumed

There are no liabilities, including contingent liabilities and guarantees, to be assumed by Tamadam pursuant to the Proposed BLH Acquisition.

2.11 Original Cost Of Investment

BIF’s original cost of investment in the BLH Sale Shares is RM0.51 million which was incurred in December 2003. In addition, BIF had advanced funds to BLH and BLH had also incurred external borrowings to finance its equity investment in LSGB.

3. PROPOSED DHOST ACQUISITION

3.1 Background Information On The Proposed DHost Acquisition

Pursuant to the terms of the DHost Agreement, the Company shall purchase 127,500 Shares in DHost, representing 51% of its issued and paid-up share capital, for a purchase consideration of RM6.12 million to be satisfied by the issuance of 7,200,000 new Tamadam Shares valued at RM0.85 per Share.

3.2 Salient Terms Of The DHost Agreement

The salient terms of the DHostAgreement are as follows :-

(a) Acquisition of the DHost Sale Shares

Subject to the terms and conditions of the DHost Agreement, DHSB shall sell and Tamadam shall purchase all, and not some only, of the DHost Sale Shares in consideration of the 7,200,000new Shares in Tamadam valued at RM0.85 per Share and on the terms and conditions set out in the DHost Agreement free from all liens, claims, charges, mortgages, equities and other encumbrances whatsoever, but with all rights and advantages attaching thereto or accruing thereon together with all dividends (including dividends declared and but not paid) as at a date to be mutually agreed between DHSB and Tamadam falling within fourteen (14) days from the date that the last of the conditions precedent set out in Section 3.2(c) of this Announcement have been fulfilled or waived (“DHostCompletion Date”).

The parties acknowledge that DHSB and Tamadam have agreed to sell and to purchase the DHost Sale Shares respectively, on the express basis that Tamadam shall execute a deed of accession to the Shareholders’ Agreement dated 3 December 1997 entered into between DHSB, DHost and Host International Inc. (“Host International”) (“DHost Shareholders’ Agreement”), wherein Tamadam agrees to be bound by the DHost Shareholders’ Agreement as if it was the original party to the DHost Shareholders’ Agreement, and for such deed to take effect at the DHost Completion Date.

(b) Purchase Consideration

(i) The indicative purchase consideration for the DHost Sale Shares shall be RM6.12 million to be satisfied by the issuance 7,200,000new Shares in Tamadam valued at RM0.85 per Share (“DHost Indicative Purchase Consideration”).

(ii) In the event that the SC imposes conditions that would affect the RM0.85 value of the new Tamadam Shares to be issued by less than five percent (5%), the revised value of the new Tamadam Shares shall be deemed to have been accepted by both DHSB and Tamadam.

(iii) In the event that the SC imposes conditions that would affect the DHost Indicative Purchase Consideration or the RM0.85 value of the new Tamadam Shares to be issued by more than five percent (5%) :-

(aa) the parties agree to first confer in good faith (on an urgent and immediate basis) whether to accept or not such revised value of the new Tamadam Shares; and

(bb) if any party does not so accept, then the provisions of Clauses 4.2(b), 4.2(c), 4.5 and 4.6 of the DHost Agreement shall, mutatis mutandis, take effect.

(c) Conditions Precedent

The completion of the DHost Agreement is conditional upon the following conditions being satisfied on or before the day falling eight (8) months after the execution of the DHost Agreement, or such extended date as the parties may agree to in writing :-

(i) the conditions as set out in Section 12 of this Announcement;

(ii) Tamadam being reasonably satisfied, in accordance with Clause 3.2 of the DHost Agreement, with the results of the due diligence review of DHost, its assets and businesses;

(iii) the BLH Agreement becoming unconditional;

(iv) receipt of the formal consent of Host International under the DHost Shareholders’ Agreement to the sale and purchase contemplated under the DHost Agreement including a waiver to the right granted to Host International under the DHost Shareholders’ Agreement to receive an offer in writing to purchase the DHost Sale Shares;

(v) any other consents or approvals required in respect of the business and operations of DHost from relevant Malaysian or international regulatory authorities or statutory bodies or which are otherwise found to be required during the course of the due diligence review;

(vi) where any party to the DHost Agreement by any law or regulation requires the approval of its shareholders for the sale and purchase transaction contemplated under the DHost Agreement, such shareholders’ approval;

(vii) the approval of the shareholders of DHSB for the sale and purchase transaction contemplated under the DHost Agreement;

(viii) the approval of the Board of Tamadam for an increase in the authorised share capital of Tamadam and the sale and purchase transaction contemplated under the DHost Agreement; and

(ix) the approval of the Board of DHSB for the sale and purchase transaction contemplated under the DHost Agreement.

3.3 Background Information On DHost

DHost was incorporated in Malaysia under the Act as a private limited company on 9 June 1997. As at 31 May 2007, the authorised share capital of DHost is RM250,000 comprising 250,000 Shares, of which 250,000 Shares have been issued and are fully paid-up. As at 31 May 2007, the shareholders of DHost are DHSB and Host International holding 51% and 49% of the equity interest in DHost respectively.

DHost is principally involved in the food catering business where it currently owns and operates a total of eleven (11) restaurants and cafes that are located at the KLIA and the Low Cost Carrier Terminal (“LCCT”) including Burger King, Asian Kitchen, Café Marche and Suria Café.

Based on the audited financial statements of DHost for the FYE 31 December 2006, the net profits and net deficit in shareholders’ funds of DHost are approximately RM1.535 million and RM0.645 million respectively.

The historical financial information of DHost is set out in Table 1(B) of the Appendix of this Announcement.

3.4 Background Information On DHSB

DHSB was incorporated in Malaysia under the Act as a private limited company on 21 June 2001.

The principal activity of DHSB is investment holding.

As at 31 May 2007, the directors of DHSB are Datuk Ibrahim bin Haji Ahmad, Datin Aminah binti Haji Ahmad, Datin Dr. Hiryati binti Abdullah and Nur Fatin binti Ibrahim, and the sole shareholder of DHSB is Datuk Ibrahim bin Haji Ahmad.

3.5 Basis Of Arriving At The Purchase Consideration

The purchase consideration for the Proposed DHost Acquisition of RM6.12 million was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the earnings potential of DHost.

3.6 Basis Of Determining The Issue Price For The New Tamadam Shares

The issue price for the new Tamadam Shares of RM1.00 per Share was arrived at based on the par value of Tamadam Shares.

3.7 Basis Of Determining The Value Of The New Tamadam Shares

The new Tamadam Shares has been valued at RM0.85 per Share which was arrived at after taking into consideration the following :-

(i) the 5-day, 1-month and 3-month WAP of Tamadam Shares up to and including 10 May 2007, being the last market day prior to the announcement on the Proposed Acquisitions on 11 May 2007, of RM0.74, RM0.71 and RM0.74 respectively; and

(ii) the audited consolidated net assets per Share of Tamadam as at 31 December 2006 of RM0.55.

The 5-day WAP of Tamadam Shares up to and including 27 June 2007, being the last market day prior to this Announcement was RM1.25.

3.8 Ranking Of The New Tamadam Shares

The new Tamadam Shares to be issued pursuant to the Proposed DHost Acquisition shall, upon allotment and issue, rank pari passu in all respects with the existing issued Shares of Tamadam.

3.9 Shares Acquired Free From Encumbrances

The DHost Sale Shares shall be acquired free from all liens, claims, charges, mortgages, equities and other encumbrances whatsoever, but with all rights and advantages attaching thereto or accruing thereon together with all dividends (including dividends declared and but not paid) as at the DHost Completion Date.

3.10 Liabilities To Be Assumed

There are no liabilities, including contingent liabilities and guarantees, to be assumed by Tamadam pursuant to the Proposed DHost Acquisition.

3.11 Original Cost Of Investment

DHSB’s original cost of investment in DHost is approximately RM0.128 million which was incurred in 1998.

4. PROPOSED BIF WAIVER

Upon completion of the Proposed Acquisitions, BIF will hold 152,941,177 Shares in Tamadam, representing approximately 73.1% of its enlarged issued and paid-up share capital.

Pursuant to Part II Section 6 of the Malaysian Code On Take-Overs And Mergers, 1998 (“Code”), BIF and parties acting in concert with it will be required to extend a mandatory GO for all the remaining Shares not already owned by them in Tamadam and all new Shares that may be allotted and issued pursuant to the exercise of the Warrants, after the Proposed Acquisitions.

BIF and parties acting in concert with it will seek a waiver from the obligation to extend a mandatory GO under Practice Note 2.9.1 of the Code (exemption if transactions involve issue of new securities).

5. PROPOSED TAMADAM WAIVER

Upon completion of the Proposed BLH Acquisition, Tamadam will hold 51.0% of the issued and paid-up share capital of BLH. Accordingly, pursuant to Part II Section 6 of the Code, Tamadam and parties acting in concert with it will be required to extend a mandatory GO for all the remaining Shares not already owned by them in BLH after the Proposed BLH Acquisition.

In addition, pursuant to Practice Note 2.2 and Part II Section 6 of the Code, Tamadam and parties acting in concert with it will also be required to extend a mandatory GO for all the remaining Shares not already owned by them in LSGB after the Proposed BLH Acquisition.

Tamadam and parties acting in concert with it will seek a waiver from the obligation to extend a mandatory GO under Practice Note 2.9.6 of the Code (exemption on the basis that the remaining holders of voting shares in BLH and LSGB respectively have given written undertakings not to accept the offer by Tamadam).

6. PROPOSED OFFER FOR SALE AND/OR PLACEMENT

Paragraph 8.15 of the Listing Requirements of the Bursa Malaysia Securities Berhad (“Bursa Securities”) stipulates that a listed issuer must ensure that at least 25% of its total listed shares are in the hands of a minimum of 1,000 public shareholders holding not less than 100 shares each.

In order to comply with the public shareholding spread requirement upon completion of the Proposed Acquisitions, BIF is proposing to undertake an offer for sale and/or placement of such number of Shares held by it in Tamadam to the Malaysian public to address the shortfall in Tamadam’s public shareholding spread. In such event, the proceeds arising from the Proposed Offer For Sale And/Or Placement will accrue to BIF. No part of the proceeds will be received by Tamadam.

7. PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

The present authorised share capital of the Company is RM100,000,000 comprising 100,000,000 Shares, of which 49,005,000 Shares have been issued and are fully paid-up as at 31 May 2007.

In order to facilitate the implementation of the Proposed BLH Acquisition, the Company proposes to increase the authorised share capital from RM100,000,000 comprising 100,000,000 Shares to RM500,000,000 comprising 500,000,000 Shares.

8. INTER-CONDITIONALITY OF THE COMPONENTS OF THE PROPOSALS

The Proposed DHost Acquisition and the Proposed Offer For Sale And/Or Placement are conditional upon the Proposed BLH Acquisition. The Proposed BLH Acquisition is conditional upon the Proposed Tamadam Waiver. The Proposed Acquisitions are conditional upon the Proposed BIF Waiver.

The Proposed Increase In Authorised Share Capital is conditional upon the Proposed BLH Acquisition.

9. RATIONALE FOR THE PROPOSALS

The Tamadam group of companies (”Tamadam Group”) has been principally involved in the business of bonded warehousing, freight forwarding and transportation services. However, in recent times, the business environment in which the Tamadam Group operates has proven to be competitive. Therefore, the Proposed Acquisitions represent an opportunity for Tamadam to diversify its business. With the Proposed Acquisitions, the Tamadam Group will be able to expand into the food catering and related businesses and will immediately benefit in terms of steady income stream from the BLH Group and DHost respectively. Going forward, the Proposed Acquisitions will provide a new source of growth and contribute positively to the future earnings of the Tamadam Group.

On the other hand, the Proposed Offer For Sale And/Or Placement will enable Tamadam to comply with the public shareholding spread requirement stipulated by Bursa Securities.

10. RISK FACTORS AND PROSPECTS

10.1 Risk Factors

(a) Business Risks

The Proposed Acquisitions will expand the business activities of the Tamadam Group to include those of food catering and related businesses, and therefore will subject the Tamadam Group to inherent risks associated with these businesses, including but not limited to, increase in operating costs, changes in general outlook and operating environment of the sector, demand and supply conditions, seasonality and unforeseen outbreak of disease. There can be no assurance that any adverse change to these factors will not have a material and/or adverse effect on the operations and financial performance of the Tamadam Group.

(b) Dependence On Catering Agreement with MAS

Presently, MAS is the single largest customer of LSGB. In addition, LSGB has a catering agreement with MAS which gives LSGB the exclusive right to supply and provide in-flight catering and cabin handling services to MAS at both the KLIA and Penang airport for a period of twenty-five (25) years until 2028. There can be no assurance that any adverse change in the business relationship between MAS and LSGB or any unilateral termination of the catering agreement will not have a material and/or adverse effect on the business prospect of LSGB and consequently, BLH.

Notwithstanding this, currently, LSGB has a good working relationship with MAS and this relationship is being regulated by the Subsidiary’s Shareholders’ Agreement entered into in September 2003. In addition, MAS also holds the remaining 30% equity interest in LSGB. Thus, any disruption in the operations or material and/or adverse effect on the business prospect of LSGB will not be in the best interest of the parties.

(c) Dependence On Technical Assistance Agreement with LSGB Asia

LSGB has a technical assistance agreement with LSG Asia which basically entails the provision of various technical assistance for a period of twenty-five (25) years until 2028. There can be no assurance that any adverse change in the business relationship between LSG Asia and LSGB or any unilateral termination of the technical assistance agreement will not have a material and/or adverse effect on the business operations of LSGB and consequently, BLH.

Notwithstanding this, currently, LSGB has a good working relationship with LSG Asia and this relationship is being regulated by the Shareholders’ Agreement entered into in September 2003. In addition, LSG Asia also holds the remaining 49% equity interest in BLH.

(d) Dependence On Key Personnel

The continued performance and future success of the BLH Group and DHost hinges on the ability and continued effort of the respective key management team of the said companies. Any sudden departure of members of the key management team may affect the performance of the BLH Group and/or DHost.

It is expected that there should not be any disruptions in the business operations of these companies after the completion of the Proposed Acquisitions as the Proposed Acquisitions do not entail any change in the employment of these companies. This in turn will ensure the continued performance and success of the BLH Group and DHost into the future.

(e) Dependence On Franchise Arrangement

DHost operates all the Burger King outlets at KLIA under a franchise agreement entered into by DHost. An event of default and/or breach under the franchise agreement, if not capable of being remedied, may lead to termination of the franchise agreement or jeopardise the ability of DHost to renew the franchise in the future.

(f) Borrowing Risk

As at 31 May 2007, the BLH Group has a total borrowings of approximately RM123.47 million.

Accordingly, the BLH Group is subject to risks associated with debt financing, including changes in the level of interest rates and liquidity risk. However, the BLH Group has not had any difficulty in servicing and/or settling any of its borrowings. Notwithstanding this, there can be no assurance that the fluctuations in interest rates will not have a material and/or adverse effect on the profitability and cash flow position of the BLH Group.

(g) Introduction Of New Controlling Shareholder

Upon completion of the Proposed Acquisitions, BIF will be the new controlling shareholder of Tamadam. As such, it is likely that BIF will be able to effectively control the business direction and management of Tamadam by virtue of its eventual controlling shareholding in Tamadam as well as through its nominee directors who will sit on the board of Tamadam, unless BIF and/or its nominee directors are required to abstain from voting by law and/or by relevant authorities.

(h) Political And Economic Considerations

Like any other business entities, changes in political and economic conditions in Malaysia could materially and/or adversely affect the profitability and business prospects of the BLH Group and DHost. These political and economic uncertainties include, but not limited to, the changes in political leadership, expropriation, nationalisation and methods of taxation.

10.2 Prospects Of The BLH Group, DHost And The Enlarged Tamadam Group

With LSGB being the principal provider of in-flight catering at both the KLIA and Penang airport, it can be said that LSGB and consequently, BLH is well-poised to reap the benefits of further growth in passenger traffic at both airports, particularly at KLIA, being the main international gateway to Malaysia. The growth in passenger traffic will also augur well for the food catering business of DHost as its restaurants and cafes are located at the KLIA and the LCCT. This in turn will bode well for Tamadam as it may result in higher income and cashflow contribution from BLH and DHost respectively.

11. EFFECTS OF THE PROPOSALS

11.1 Share Capital

The effects of the Proposed Acquisitions on the share capital of Tamadam is set out in Table 3 of the Appendix of this Announcement.

The Proposed Waivers, the Proposed Offer For Sale And/Or Placement and the Proposed Increase In Authorised Share Capital do not have any effect on the issued and paid-up share capital of Tamadam.
11.2 Net Assets And Gearing

Based on the audited financial statements of the Tamadam Group as at 31 December 2006 and on the assumption that the Proposed Acquisitions had been effected on that date, the proforma effects of the Proposed Acquisitions on the net assets and gearing of the Tamadam Group are set out in Table 4 of the Appendix of this Announcement.

The proforma effects of the Proposed Acquisitions on the net assets and gearing of the Tamadam Group are subject to review by the Reporting Accountants of Tamadam.

The Proposed Waivers, the Proposed Offer For Sale And/Or Placement and the Proposed Increase In Authorised Share Capital do not have any effect on the net assets and gearing of the Tamadam Group.

11.3 Earnings

The Proposed Acquisitions are not expected to have any material effect on the earnings of the Tamadam Group for the financial year ending 31 December 2007 as the Proposed Acquisitions are only expected to be completed in the last quarter of 2007. Barring unforeseen circumstances, the Proposed Acquisitions are expected to contribute positively to the future earnings of the Tamadam Group.

The Proposed Waivers, the Proposed Offer For Sale And/Or Placement and the Proposed Increase In Authorised Share Capital do not have any effect on the earnings of the Tamadam Group.

11.4 Substantial Shareholders’ Shareholdings

The effects of the Proposed Acquisitions and the Proposed Offer For Sale And/Or Placement on the substantial shareholders and their shareholdings in Tamadam are set out in Table 5 of the Appendix of this Announcement.

The Proposed Waivers and the Proposed Increase In Authorised Share Capital do not have any effect on the shareholdings of the substantial shareholders in Tamadam.

The Proposed Acquisitions will result in the introduction of a new controlling shareholder for Tamadam.

12. CONDITIONS TO THE PROPOSALS

The Proposals are conditional upon the following :-

(a) the approval of the SC for the following :-

(i) Proposed Acquisitions;

(ii) Proposed Waivers; and

(iii) the listing of and quotation for the new Shares to be issued pursuant to the Proposed Acquisitions;

(b) the approval of the Equity Compliance Unit of the SC for the Proposed Acquisitions;

(c) the approval of the shareholders of Tamadam at an extraordinary general meeting to be convened for the Proposed Acquisitions, the Proposed BIF Waiver and the Proposed Increase In Authorised Share Capital;

(d) the approval of Bursa Securities for the listing of and quotation for the new Shares to be issued pursuant to the Proposed Acquisitions; and

(e) the approvals, waivers and/or consents from any other relevant authorities and/or persons, if required.

13. DEPARTURE FROM THE POLICIES AND GUIDELINES ON ISSUE / OFFER OF SECURITIES OF THE SC (“SC GUIDELINES”)

To the best of the knowledge of the Board of Tamadam, the Proposed Acquisitions do not depart from the SC Guidelines.

14. DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTERESTS

None of the directors and major shareholders of the Company as well as persons connected with them have any interest, direct and/or indirect, in the Proposals.

15. DIRECTORS’ STATEMENT

Having considered the rationale and effects of the Proposals, after due deliberation, the Board of Tamadam is of the opinion that the Proposals are in the best interest of the Company and its shareholders.

16. ADVISERS

AmInvestment Bank has been appointed as Adviser to the Company for the Proposals.

An independent adviser will be appointed by the Company for the Proposed BIF Waiver and the appointment will be subject to the approval of the SC.

17. ESTIMATED TIMEFRAME FOR COMPLETION

Barring unforeseen circumstances, the Board of Tamadam expects the Proposals to be completed in the last quarter of 2007.

18. APPLICATIONS TO THE RELEVANT AUTHORITIES

Applications to the relevant authorities for the Proposed Acquisitions and the Proposed Waivers are expected to be submitted within two (2) months from the date of this Announcement.

19. DOCUMENTS AVAILABLE FOR INSPECTION

Download Appendix Tables (.doc format)

This announcement is dated 28 June 2007.

TAMADAM BONDED WAREHOUSE BERHAD (“TAMADAM” OR “COMPANY”)
MEMORANDUM OF UNDERSTANDING ON THE FOLLOWING :-

(i) PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN BRAHIM’S-LSG SKY CHEFS HOLDINGS SDN BHD (“BLH”) FROM BRAHIM’S INTERNATIONAL FRANCHISES SDN BHD (“BIF”) (“PROPOSED BLH ACQUISITION”);

AND

(ii) PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN DEWINA HOST SDN BHD (“DHOST”) FROM DEWINA HOLDINGS SDN BHD (“DHSB”) (“PROPOSED DHOST ACQUISITION”)
(COLLECTIVELY TO BE REFERRED TO AS “PROPOSED ACQUISITIONS”)

We refer to the Company’s announcement dated 11 May 2007 where it was announced that the Company had entered into a memorandum of understanding with BIF (“BIF MoU”) for purposes of the Proposed BLH Acquisition. It was also announced that the Company had on even date entered into a memorandum of understanding with DHSB (“Dewina MoU”) for the Proposed DHost Acquisition.

(The BIF MoU and the Dewina MoU are to be collectively referred to as “the MoUs”)

In this respect, on behalf of the Company, AmInvestment Bank Berhad (formerly known as AmMerchant Bank Berhad) (a member of AmInvestment Bank Group) wishes to announce that the parties to the MoUs have, by way of exchange of letters (“Letters of Extension”), mutually agreed to extend the period for the finalisation and execution of the share sale agreements for the Proposed BLH Acquisition and the Proposed DHost Acquisition respectively from 11 June 2007 to 10 July 2007. Save for the said extensions, all other terms of the MoUs remain unchanged.

The Letters of Extension will be made available for inspection at the registered office of Tamadam at Mezzanine Floor, 8A Jalan Sri Semantan Satu, Damansara Heights, 50490 Kuala Lumpur during normal business hours from Mondays to Fridays (except public holidays) for a period of three (3) months from the date of this Announcement.

This announcement is dated 8 June 2007.

TAMADAM BONDED WAREHOUSE BERHAD (“TAMADAM” OR “COMPANY”)
MEMORANDUM OF UNDERSTANDING ON THE FOLLOWING :-

(i) PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN BRAHIM’S-LSG SKY CHEFS HOLDINGS SDN BHD (“BLH”) FROM BRAHIM’S INTERNATIONAL FRANCHISES SDN BHD (“BIF”) (“PROPOSED BLH ACQUISITION”);

AND

(ii) PROPOSED ACQUISITION OF 51% EQUITY INTEREST IN DEWINA HOST SDN BHD (“DHOST”) FROM DEWINA HOLDINGS SDN BHD (“DHSB”) (“PROPOSED DHOST ACQUISITION”)
(COLLECTIVELY TO BE REFERRED TO AS “PROPOSED ACQUISITIONS”)

1. INTRODUCTION

On behalf of Tamadam, AmInvestment Bank Berhad (formerly known as AmMerchant Bank Berhad) (a member of AmInvestment Group) (“AmInvestment Bank”) would like to announce that the Company has today entered into a memorandum of understanding with BIF (“BIF MoU”) for purposes of the Proposed BLH Acquisition. The Company has also today entered into a memorandum of understanding with DHSB (“Dewina MoU”) for purposes of the Proposed DHost Acquisition.

(The BIF MoU and the Dewina MoU to be collectively referred to as “MoUs”)

Pursuant to the MoUs, the parties have agreed to exercise their best endeavour to finalise the terms of the Proposed Acquisitions with the intention to enter into the relevant share sale agreements (“Agreements”). The MoUs is binding upon the parties.

2. INFORMATION ON BLH AND DHOST

2.1 Background Information On BLH
BLH was incorporated in Malaysia under the Companies Act, 1965 (“Act”) as a private limited company on 18 June 2002.

As at 30 April 2007, the authorised share capital of BLH is RM5,000,000 comprising 4,990,000 ordinary shares of RM1.00 each (“Shares”) and 1,000,000 preference shares of RM0.01 each, of which 1,000,000 Shares have been issued and are fully paid-up.

BLH is principally an investment holding company. Its sole 70%-owned subsidiary, LSG Sky Chefs-Brahim’s Sdn Bhd (“LSGB”), is principally involved in the provision of in-flight catering and its related services such as cabin handling. Currently, LSGB is the principal in-flight catering service provider at both the Kuala Lumpur International Airport (“KLIA”) and Penang airport where its clientele consist of international as well as domestic airlines.

LSGB has a catering agreement with Malaysian Airline System Berhad (“MAS”) which gives LSGB the exclusive right to supply and provide in-flight catering and cabin handling services to MAS at both the KLIA and Penang airport. LSGB also has a technical assistance agreement with LSG Asia GmbH (“LSG Asia”) which basically entails the provision of various technical assistance by LSG Asia for the operations of LSGB. MAS holds the remaining 30% equity interest in LSGB.

Based on the audited consolidated financial statements of BLH for the financial year ended (“FYE”) 31 December 2005, the net profits and net assets of BLH are approximately RM10.303 million and RM30.031 million respectively.

2.2 Background Information On DHost
DHost was incorporated in Malaysia under the Act as a private limited company on 20 September 1997.

As at 30 April 2007, the authorised share capital of DHost is RM250,000 comprising 250,000 Shares, of which 250,000 Shares have been issued and are fully paid-up.

DHost is principally involved in the food catering business where it currently owns and operates a total of eleven (11) restaurants and cafes that are located at the KLIA and the Low Cost Carrier Terminal (“LCCT”) including Burger King, Asian Kitchen, Café Marche and Suria Café.

Based on the audited financial statements of DHost for the FYE 31 December 2005, the net profits and net deficit in shareholders’ funds of DHost are approximately RM1.972 million and RM2.180 million respectively.

3. SALIENT TERMS OF THE MOUs

3.1 BIF MOU
The salient terms of the BIF MoU are as follows :-

(a) Tamadam and BIF agree to negotiate in good faith and use its best endeavours to agree upon the terms of, prepare, finalise and execute the share sale agreement for the Proposed BLH Acquisition (“BLH SSA”) no later than thirty (30) days from the date of the BIF MoU or such longer period as may be mutually agreed between the parties.

(b) The BLH SSA to be executed and agreed upon by the parties shall reflect provisions of the BIF MOU and will include provisions acceptable to the parties as appropriate in transactions of the same type and magnitude reflecting, inter alia, the following understanding and principal terms :-

(i) The indicative purchase consideration for 51% equity interest in BLH shall be RM130.0 million (“Indicative BLH Price”).

(ii) The final purchase consideration for the Proposed BLH Acquisition shall be satisfied by the issuance of such number of new Shares in Tamadam at an indicative valuation of RM0.85 per Share ranking pari passu with the existing Shares in Tamadam.

(iii) The final purchase consideration for the Proposed BLH Acquisition shall be subject to a valuation to be conducted by an independent valuer to be appointed by Tamadam and will be subject to the approval of the Securities Commission (“SC”).

(iv) The Proposed BLH Acquisition shall be subject to the following :-

(aa) A waiver to be sought from the SC under the Malaysian Code on Take-Overs and Mergers, 1998 (“Code”) to exempt Tamadam and parties acting in concert with it from the obligation to extend a general offer (“GO”) for all the remaining Shares not already owned by them in BLH and LSGB;

(bb) A waiver to be sought from the SC under the Code to exempt BIF and parties acting in concert with it from the obligation to extend a GO for all the remaining Shares not already owned by them in Tamadam;

(cc) the approval of the shareholders of Tamadam for the Proposed BLH Acquisition and an increase in the authorised share capital of Tamadam;

(dd) the consents of other shareholders of BLH and/or LSGB as may be required; and

(ee) approvals and consents of all appropriate authorities, corporate, creditors and any other parties which are required or advisable for or in connection with the Proposed BLH Acquisition, and the fulfilment of all other condition precedents as may be determined by the parties.

(c) Tamadam shall be entitled to carry out a legal, operational, financial and tax due diligence review on BLH, LSGB, their respective assets and businesses at Tamadam’s own cost and expense, within thirty (30) days or such other mutually extended period commencing from the date of the BLH SSA.

(d) The BIF MoU shall automatically terminate and be of no effect on the occurrence of any of the following events :-

(i) the execution of the BLH SSA by the parties;

(ii) any of the agreed timeframes set out in the BIF MoU is not met and the parties are unable to agree in writing on an extension of such timeframe(s);

(iii) the mutual agreement to terminate by Tamadam and BIF; and

(iv) as may be otherwise provided in the BIF MoU.

3.2 DEWINA MOU
The salient terms of the Dewina MoU are as follows :-

(a) Tamadam and DHSB agree to negotiate in good faith and use its best endeavours to agree upon the terms of, prepare, finalise and execute the share sale agreement for the Proposed DHost Acquisition (“DHost SSA”) no later than thirty (30) days from the date of the Dewina MoU or such longer period as may be mutually agreed between the parties.

(b) The DHost SSA to be executed and agreed upon by the parties shall reflect provisions of the Dewina MOU and will include provisions acceptable to the parties as appropriate in transactions of the same type and magnitude reflecting, inter alia, the following understanding and principal terms :-

(i) The indicative purchase consideration for 51% equity interest in DHost shall be RM6.12 million (“Indicative DHost Price”).

(ii) The final purchase consideration for the Proposed DHost Acquisition shall be satisfied by the issuance of such number of new Shares in Tamadam at an indicative valuation of RM0.85 per Share ranking pari passu with the existing Shares in Tamadam.

(iii) The Proposed DHost Acquisition shall be conditional on the Proposed BLH Acquisition becoming unconditional.

(iv) The Proposed DHost Acquisition shall be subject to the following :-

(aa) the approval of the shareholders of Tamadam for the Proposed DHost Acquisition and an increase in the authorised share capital of Tamadam;

(bb) the consent of other shareholders of DHost, if such consent is required; and

(cc) approvals and consents of all appropriate authorities, corporate, creditors and any other parties which are required or advisable for or in connection with the Proposed DHost Acquisition, and the fulfilment of all other condition precedents as may be determined by the parties.

(c) Tamadam shall be entitled to carry out a legal, operational, financial and tax due diligence review on DHost, its assets and its business at Tamadam’s own cost and expense, within thirty (30) days or such other mutually extended period commencing from the date of the DHost SSA.

(d) The Dewina MoU shall automatically terminate and be of no effect on the occurrence of any of the following events :-

(i) the execution of the DHost SSA by the parties;

(ii) any of the agreed timeframes set out in the Dewina MoU is not met and the parties are unable to agree in writing on an extension of such timeframe(s);

(iii) the mutual agreement to terminate by Tamadam and Dewina; and

(iv) as may be otherwise provided in the Dewina MoU.

4. BASIS OF ARRIVING AT THE INDICATIVE PURCHASE CONSIDERATION

The Indicative BLH Price was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the adjusted net asset value of BLH after adjusting for the indicative valuation of its 70% equity interest in LSGB using the discounted cashflow methodology.

The Indicative DHost Price was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the earnings potential of DHost.

5. RATIONALE FOR THE PROPOSED ACQUISITIONS

With the Proposed Acquisitions, Tamadam will be able to benefit immediately in terms of earnings contribution from the BLH group of companies and DHost respectively. Further, with LSGB being the principal provider of in-flight catering at both the KLIA and Penang airport, it can be said that LSGB and consequently, BLH is well-poised to reap the benefits of further growth in passenger traffic at both airports, particularly at KLIA, being the main international gateway to Malaysia. The growth in passenger traffic will also augur well for the food catering business of DHost as its restaurants and cafes are located at the KLIA and the LCCT. This in turn will bode well for Tamadam as it may result in higher income and cashflow contribution from BLH and DHost respectively.

6. DOCUMENTS AVAILABLE FOR INSPECTION

The MoUs will be made available for inspection at the registered office of Tamadam at Mezzanine Floor, 8A Jalan Sri Semantan Satu, Damansara Heights, 50490 Kuala Lumpur during normal business hours from Monday to Fridays (except public holidays) for a period of three (3) months from the date of this Announcement.

A detailed announcement on the Proposed Acquisitions will be made upon finalisation of the terms and conditions of the Proposed Acquisitions, including the execution of the Agreements for the Proposed Acquisitions.

This announcement is dated 11 May 2007.

ANNOUNCEMENT DATED 8 JUNE 06
Proposed Sale and Leaseback Of Lot 11614 and Lot PT 21596, Mukim and District of Klang, Selangor Darul Ehsan (collectively known as “the Property”) (“Proposed Sale and Leaseback”)

1. INTRODUCTION 

We refer to the announcements dated 30 May 2006 and 28 March 2006 in relation to the above.

On behalf of the Board of Directors of Tamadam (“Board”), Public Merchant Bank Berhad (“Public Merchant”) wishes to announce that Tamadam had on 8 June 2006 entered into a Sale and Purchase Agreement (“Agreement”) with Amanah Raya Berhad (“ARB”) for the sale of the above-mentioned Property from Tamadam to ARB for a cash consideration of RM27.9 million (“Purchase Price”). On 8 June 2006, Tamadam and ARB had also simultaneously entered into a Lease Agreement (“LA”) pursuant to which Tamadam agrees to lease back the Property from ARB for ten (10) years (extendable for an additional five (5) years). In addition, Tamadam will have a first right of refusal to repurchase the Property from ARB should ARB decide to sell the Property during the term of the lease.

2. DETAILS OF THE PROPOSED SALE AND LEASEBACK 

2.1 Description of the Property 

Please refer to Table 1 for description of the Property.

2.2 Basis of arriving at the sale consideration for the Property

The cash sale consideration for the Proposed Sale and Leaseback of RM27.9 million was arrived at on a willing buyer-willing seller basis, after taking into consideration the market value of the Property of RM29.0 million as appraised by Jabatan Penilaian dan Perkhidmatan Harta (“JPPH”), a department in the Ministry of Finance, Malaysia, vide its valuation report dated 26 April 2006. The Purchase Price is a discount of approximately 3.8% to the value given by JPPH.

The Board is of the view that the offer for RM27.9 million from ARB is reasonable and acceptable to the Company.

2.3 Information on ARB

ARB is a trustee company established as the Department of Public Trustee and Official Administrator on 1 May 1921. The Department of Public Trustee and Official Administrator was corporatised on 29 May 1995 and on 1 August 1995 commenced its operations as ARB. ARB is principally involved in providing trust, deceased estate administration and will services. ARB is wholly-owned by the Government of Malaysia through the Minister of Finance (Incorporated).

2.4 Original cost of investment

The aggregate cost of investment for the Property is as follows:

	RM
Original purchase price	10,500,000
Stamp duty	391,830
Professional fees	31,925
Coldroom	8,755,322
Building improvements	7,727,273
	27,506,350

The Property was purchased from Innovest Berhad through a Sale & Purchase Agreement dated 31 December 1992. Lot 11614 Mukim and District of Klang, Selangor (“Lot 11614”) was registered on 11 March 1982 and Lot PT 21596 Mukim and District of Klang, Selangor (“Lot PT 21596”) was registered on 11 May 1990.

2.5 Salient terms and conditions of the Agreement and LA

An extract of the salient terms and conditions of the Agreement is set out below:

(i) Tamadam agrees to sell and ARB agrees to buy the Property at a price of RM27.9 million. The Property shall be sold to ARB free from all encumbrances but subject to all conditions and restriction in interest express or implied in the issue documents of title to the Property.

(ii) The Agreement is conditional upon the following:

(a) the Foreign Investment Committee’s approval;

(b) Tamadam shareholders’ approval; and

(c) obtaining the approval of the relevant State Authority pertaining to the transfer of Lot PT 21596 to ARB.

(collectively known as the “Conditions Precedent”).

(iii) ARB shall pay the Purchase Price at the time and in the following manner:

(a) the earnest deposit of RM558,000 or two percent (2%) of the Purchase Price (“Earnest Money”) to ARB’s solicitors as stakeholders, which the ARB’s solicitors have received on 23 May 2006;

(b) the balance deposit of RM2,232,000 (“Balance Deposit”) or eight percent (8.0%) of the Purchase Price less half (1/2) of the
arrangement fee of RM697,500 (“ArrangementFee”) or 2.5% of the Purchase Price to the ARB’s solicitors as stakeholders upon execution of the Agreement;

(c) the redemption sum to the chargee on or before the Completion Date to redeem the said Property from the chargee and procure the Discharge Documents subject to Tamadam having delivered to the ARB or ARB’s solicitors a redemption statement cum letter of undertaking issued by the chargee and addressed to the ARB within ten (10) Business Days from the date of receipt of a written request from the ARB’s solicitors;

(d) The balance purchase price of RM25,668,000 (“Balance Purchase Price”) less half (1/2) of the Arrangement Fee less the redemption sum and less the security deposit under the lease to the ARB’s solicitors as stakeholders within three (3) months or such extended date as mutually agreed by both parties hereto from the date of fulfilment of the Conditions Precedent; and

(e) ARB’s solicitors to release the Earnest Money and the Balance Deposit and all interest earned and accrued thereon to the Tamadam upon presentation of the Discharge Documents and the Instrument of Transfer together with the Balance Purchase Price.

(iv) ARB has agreed to purchase the said Property in reliance upon the agreement and assurance of Tamadam that it will take the lease of the Property upon the terms and conditions set out in the LA.

An extract of the salient terms and conditions of the LA is set out below:
(i) In the event that ARB desire to sell the Property at any time during ten (10) year term of lease (“Term”), ARB shall, before offering the said Property for sale to any other person, give to Tamadam the first right of refusal to purchase the Property;

(ii) Tamadam shall have the right to renew the lease for a further term of five (5) years from the date of expiry of the said Term provided that Tamadam shall notify ARB in writing not less than six (6) months before expiration of the said Term.

(iii) The guaranteed net yearly rate of lease rental for the tenure of the said Term of the lease shall be as follows (calculated based on the Purchase Price of the Property at RM27.9 Million) payable on monthly basis in advance:

Term Annual Rate Net Rental per month
Year 1 to Year 2 7.40% RM172,050
Year 3 to Year 4 7.70% RM179,025
Year 5 to Year 6 8.20% RM190,650
Year 7 to Year 8 8.60% RM199,950
Year 9 to Year 10 9.10% RM211,575
Average 8.20% RM190,650

(iv) Tamadam, as the lessee, shall bear and pay or otherwise be responsible for all costs of outgoings, i.e. all services and maintenance charges (where applicable) including but not limited to, building repairs, quit rent, assessments, fire/building insurance and/or other related capital expenditure/costs payable in respect of the said Property for the whole duration of the said Term under the lease.

2.6 Liabilities to be assumed by ARB
There are no liabilities to be assumed by ARB arising from the Proposed Sale and Leaseback

2.7 Utilisation of proceeds
The Proposed Sale and Leaseback will raise net cash proceeds of RM23.9 million.

	RM
Purchase Price	27,900,000
Less expenses incurred in the Proposed Sale and Leaseback	(3,972,820)
Net proceeds	23,927,180

The net proceeds will be utilised as follows.

	RM
Repayment of borrowings	11,900,000
Rental Security Deposit	4,575,600
Upgrading of warehouse1	1,650,000
Working capital	5,801,580
TOTAL	23,927,180

3. RATIONALE FOR THE PROPOSED SALE AND LEASEBACK 

The Proposed Sale and Leaseback was undertaken by Tamadam mainly for the purpose of realising the value of the Property which has appreciated since its initial purchase. Hence, Tamadam would be able to fully capitalise on this price increase and secure the gain of RM9.0 million from the sale whilst retaining productive use of the assets by way of the leaseback arrangement.

The Proposed Sale and Leaseback would also generate positive cashflows for the Tamadam Group and would not have any adverse impacts on the operations of the Tamadam Group. Furthermore, the funds raised from the sale will be channelled back into the Group, i.e. will be utilised to fund working capital requirements and to retire loans.

4. EFFECTS OF THE PROPOSED SALE AND LEASEBACK

4.1 Share capital of Tamadam
The Proposed Sale and Leaseback has no effect on the share capital of Tamadam.

4.2 Substantial shareholders’ shareholding in Tamadam
The Proposed Sale and Leaseback has no effect on the substantial shareholders’ shareholding in Tamadam.

4.3 Gain and effects on earnings per share
The Proposed Sale and Leaseback will result in an expected gain of RM9.0 million. Based on the audited financial statements of the Tamadam Group for FYE 2005, the net gain per share would be RM0.18.

4.4 Net assets (“NA”) per share
The pro-forma effect of the Proposed Sale and Leaseback on the NA per share of the Tamadam Group, based on the audited financial statements of the Tamadam Group for FYE 2005 is set out in Table 2 below.

5. RISK FACTORS

The Board is unaware of any risks arising from the Proposed Sale and Leaseback which could materially or adversely affect the financial and operating conditions of the Tamadam Group.

6. APPROVALS REQUIRED

The Proposed Sale and Leaseback is subject to the following approvals to be obtained:

(a) the Foreign Investment Committee’s approval;

(b) Tamadam shareholders’ approval;

(c) the relevant State Authority’s approval pertaining to the transfer of Lot PT 21596 to ARB; and

(d) any other relevant authorities, if required.

7. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS

None of the Directors, substantial shareholders or persons connected with them has any interest, direct or indirect, in the Proposed Sale and Leaseback

8. ESTIMATED TIME FRAME FOR COMPLETION

The Proposed Sale and Leaseback is expected to be completed within 3 months from the date of the Agreement.

9. DEPARTURE FROM THE SC’S POLICIES AND GUIDELINES ON ISSUE/ OFFER OF SECURITIES (“SC’S GUIDELINES”)

To the best knowledge of the Board, apart from the SC’s Guidelines on significant change in business direction of a public listed company which the Company intends to seek the SC’s waiver from compliance of the same, the terms of the Proposed Sale and Leaseback do not depart from other requirements of the SC’s Guidelines.

10. DIRECTORS’ STATEMENT

The Board is of the opinion that the Proposed Sale and Leaseback is in the best interests of the Tamadam Group.

11. DOCUMENTS FOR INSPECTION

The Agreement dated 8 June 2006, the LA dated 8 June 2006 and the valuation report by JPPH dated 26 April 2006 are available for inspection at the Tamadam’s registered office at Mezzanine Floor 8A, Jalan Sri Semantan Satu, Damansara Heights, 50490 Kuala Lumpur during normal business hours from Mondays to Fridays (except public holidays) for a period of three (3) months from the date of this announcement.

A circular to shareholders setting out the details of the Proposed Sale and Leaseback and the notice of extraordinary general meeting will be despatched to the shareholders of Tamadam in due course.

This announcement is dated 8 June 2006.