1.  INTRODUCTION

The Board of Directors of B.I.G. Industries Berhad. (“BIG” or the “Company”) wishes to announce that Alpha Billion Sdn Bhd (“Alpha Billion” or the “Vendor”), a wholly-owned subsidiary of the Company, has on 9 December 2011 entered into a sale and purchase agreement with South-East-Asia Engineering (1963) Sdn Bhd (“SEA Engineering” or the “Purchaser”) (“S&P Agreement”) to dispose of a piece of industrial leasehold land expiring on 29 December 2067 held under PM 3343 Lot No. 9203 Telok Gong, Daerah and Mukim Klang, State of Selangor measuring approximately 1.0546 hectares in area (“Land”) together with a unit of single storey industrial building and other ancillary buildings erected thereon (“Building”) bearing a postal address of Lot 9203, Jalan Udang Galah, Telok Gong, 42000 Port Klang, Selangor Darul Ehsan (hereinafter collectively referred to as the “Property”) on a “as is where is” basis for a total cash consideration of RM5,000,000 (“Proposed Disposal”).

2.  DETAILS OF VENDOR AND PURCHASER

2.1 Alpha Billion
Alpha Billion is a wholly-owned subsidiary of BIG, incorporated under the Companies Act 1965 and having its registered office at 19D, Tingkat 4, Blok 2, Pusat Perniagaan Worldwide, Jalan Tinju 13/50, Seksyen 13, 40675 Shah Alam, Selangor Darul Ehsan.  Alpha Billion is principally involved in property development.

2.2 SEA Engineering
SEA Engineering was incorporated under the Companies Act 1965 and having its registered office at No. 10A, Lebuh Gopeng, 41400 Klang, Selangor Darul Ehsan.  SEA Engineering is an investment holding company.

3.  DETAILS OF THE PROPOSED DISPOSAL

3.1 Description
Alpha Billion purchased the Land in 2005 at a consideration of RM4,000,000 and the cost of construction of the Building was RM2,313,633.  The net book value of the Property was RM6,313,633 based on  the audited financial statements of Alpha Billion as at 31 December 2010.  The age of the Property is 6 years.  It is free from any encumbrances.

3.2 Basis of arriving at the Sale Consideration
The total cash consideration of RM5,000,000 (“Sale Consideration”) was arrived at on a “willing seller and willing buyer” basis after taking into consideration of the market value of the Property in the vicinity area.  An independent valuation report was prepared by a valuer on the Property.

3.3 Expected Gains/Loss
The Group is expected to suffer a loss of approximately RM1,313,633 arising from the Proposed Disposal.

3.4 Utilisation of Proceeds
The sale proceeds arising from the Proposed Disposal will be utilised by BIG for repayment of financial obligations.

3.5 Liabilities to be assumed
Save for quit rent and assessment, there are no liabilities including contingent liabilities and guarantees, to be assumed by the Purchaser.

3.6 Existing Use of the Property
The Property is currently rented at RM33,000 per month for a period of two (2) years from 1 May 2011 to 30 April 2013.

4.  SALIENT TERMS OF THE S&P AGREEMENT

4.1 The Sale Consideration shall be settled in the following manner:-

(a)    RM500,000 deposit upon execution of the S&P Agreement;
(b)    Part payment of RM2,500,000 within 2 weeks from the date of the S&P Agreement; and
(c)    RM2,000,000 within 3 months from the date of the S&P Agreement.

4.2 The Proposed Disposal is expected to be completed upon full and final settlement of the Sale Consideration within 3 months from the date of the S&P Agreement with automatic extension of one (1) month subject to the Purchaser paying interest at a rate of 8.0% per annum (“Completion Date”) on the outstanding balance of the Sale Consideration.

5.  RATIONALE FOR THE PROPOSED DISPOSAL

Alpha Billion has no plans to develop the Property as the Property is not strategically located in areas for property development.  In addition, the Proposed Disposal will enable the Group to unlock the value of the assets as a form of investment.

6.  EFFECT OF THE PROPOSED DISPOSAL

6.1 Share Capital and Substantial Shareholders’ Shareholding
The Proposed Disposal will not have any effect on the issued and paid-up share capital and substantial shareholders’ shareholding in the Company.

6.2 Earnings Per Share
The Proposed Disposal is not expected to have any significant effect on the Group’s earnings per share for the financial year ending 31 December 2011.  It will result in a net loss on disposal of approximately RM1,313,633.

6.3 Net Assets Per Share and Gearing
The Proposed Disposal will not have any material effect on the net assets per share and gearing of the Group.

7.  APPROVAL REQUIRED

The Proposed Disposal is subject to the consent from Pihak Berkuasa Negeri and any other relevant authorities, if required.  It is not subject to the shareholders’ approval of the Company.

8.  PERCENTAGE RATIO

The highest percentage ratio applicable to the Proposed Disposal pursuant to paragraph 10.02 (g) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad is 11.95%.

9.  INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED

None of the Directors and/or major shareholders of Alpha Billion and BIG and/or persons connected with a director or major shareholder have any interest, direct or indirect, in the Proposed Disposal.

10.  STATEMENT BY THE BOARD OF DIRECTORS

The Board of Directors of BIG, having considered all aspects of the Proposed Disposal, is of the opinion that the Proposed Disposal is in the best interest of the Group.

11.  DOCUMENTS FOR INSPECTION

The S&P Agreement and a valuer’s report on the Property will be made available for inspection at the registered office of the Company at Lot 2225, Section 66, Jalan Dermaga, Pending Industrial Estate, 93450 Kuching, Sarawak during normal working 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 9 December 2011.