ZELAN BERHAD (“ZB” or the “Company”)

DISPOSAL OF 9.4 MILLION ORDINARY SHARES OF RM1.00 EACH IN IJM CORPORATION BERHAD

1.0 INTRODUCTION
 
Pursuant to Paragraph 10.06 (1) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“MMLR”), ZB wishes to announce that it had, on 25 June 2010 disposed 9.4 million ordinary shares of RM1.00 each in IJM Corporation Berhad (“IJM”) (the “Sale Shares”) in the open market at an average disposal price of RM4.8514 per share for a total consideration of RM45,465,150.52 (the “Disposal”).

2.0 DETAILS OF THE DISPOSAL
 
2.1 Information on IJM

IJM, a public listed company listed on the Main Board of Bursa Malaysia is principally involved in the construction, property development, manufacturing and quarrying, infrastructure concessions and plantations.  IJM has an authorised capital of RM3,000,000,000.00 and a paid-up capital of RM1,336,561,297.00.

2.2 Information on the Sale Shares

The Sale Shares comprised of 9.4 million ordinary shares of RM1.00 each representing approximately 0.7% of the total issued and paid-up capital of IJM.

2.3 The cash consideration of RM45,465,150.52 for the Sale Shares was derived on “willing buyer-willing seller” basis.

2.4 There are no liabilities to be assumed by the purchaser arising from the Disposal.

3.0 RATIONALE OF THE DISPOSAL

The rationale of the disposal is to realise funds from the disposal to pay bank borrowings and to provide working capital for the Group's operating requirements.

4.0 ORIGINAL COST OF INVESTMENT AND UTILISATION OF PROCEEDS

The original cost of investment of the Sale Shares was approximately RM4.14 per share at Group level and RM3.50 per share at Company level.  Subsequently since acquisition, the Company had received payment of dividends from IJM.  As at 31 March 2010, the book value of the Sale Shares was approximately RM4.88 per share at Group level.

The proceeds will be utilised to pare down bank borrowings and to provide working capital for the Group's operating requirements.

5.0 COMPLETION DATE

The disposal was completed on 25 June 2010.

6.0 FINANCIAL EFFECTS

The Disposal will not have any material financial implication and effect to the net assets per share, earnings per share, gearing and has no effect on the share capital and substantial shareholders’ shareholding of the Company.  The gain on the Disposal at Group level was approximately RM6.5 million while at the Company level was approximately RM12.6 million.

7.0 APPROVALS REQUIRED

 The Disposal is not subject to the approval of the shareholders or any relevant government authorities.

8.0 DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS

 None of the Directors and/or Substantial Shareholders of the Company or persons connected to them has any interest, direct or indirect, in the Disposal.

9.0 PERCENTAGE RATIO
 
 The highest percentage ratio applicable to the proposed PRT pursuant to paragraph 10.02 (g) of the MMLR is 9.6%.

10.0 STATEMENT BY BOARD OF DIRECTORS
 
 The Board of Directors of ZB, after due consideration of all aspects of the Disposal, are of the opinion that the Disposal is in the best interest of ZB. 

This announcement is dated 28 June 2010.