Bursa Announcements

On behalf of the Board of Directors of ELK-Desa, Mercury Securities Sdn Bhd wishes to announce that the Company proposes to undertake the following:

(i) proposed renounceable rights issue of up to 51,589,369 new ordinary shares of RM1.00 each (“Rights Share(s)”) on the basis of one (1) Rights Share for every five (5) existing ordinary shares of RM1.00 each in ELK-Desa (“ELK-Desa Share(s)” or “Share(s)”) held on an entitlement date to be determined later (“Entitlement Date”) (“Proposed Rights Issue”);

(ii) proposed increase in the authorised share capital of ELK-Desa from RM300,000,000 comprising 300,000,000 ELK-Desa Shares to RM500,000,000 comprising 500,000,000 ELK-Desa Shares (“Proposed Increase in the Authorised Share Capital”);

(iii) proposed amendment to the Memorandum of Association of ELK-Desa (“Proposed Amendment”); and

(iv) proposed exemption under Paragraph 4.08(1)(b) of the Rules on Take-Overs, Mergers and Compulsory Acquisitions (“Rules”) to Mr. Teoh Hock Chai @ Tew Hock Chai (“THC”) and persons acting in concert with him (“PACs”) from the obligation to undertake a mandatory take-over offer for all ELK-Desa Shares not already held by THC and his PACs (“Proposed Exemption”)

(collectively, the “Proposals”)

Further details on the Proposals are set out in the attachment enclosed.