The Board of Directors of Favelle Favco Berhad ("FFB or the Company") is pleased to announce that the Company had on 1 December 2011 subscribed for 10,800,000 shares of RMB1.00 each in Shanghai Favco Engineering Machinery Manufacturing Co Ltd ("SFEMM") for a total consideration of RMB10,800,000.00 (equivalent to RM5,335,124.07) resulting in SFEMM becoming a 60% owned subsidiary of FFB.
SFEMM was incorporated in China on 18 December 2009 with an authorised share capital of RMB21,000,000.00 comprising 21,000,000 shares of RMB1.00 each. SFEMM is presently dormant and the intended principal activity of SFEMM would be in the manufacturing of cranes.
None of the Directors and/or major shareholders of the Company and/or persons connected with them have any interest, direct or indirect in the subscription of shares.
The subscription of shares in SFEMM is not expected to have any material effect on the Group's earnings or net assets for the current financial year ending 31 December 2011.
This Announcement is dated 1 December 2011.