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MeGroup to lease unsold cars to car subscription service Flux

CATALIST-LISTED Malaysia-based automotive company MeGroup will, through head lease agreements, lease its unsold cars to car subscription services provider Flux, the firm said on Monday.

MeGroup's unsold inventory will be leased to Flux when the latter receives customer requests. Flux will then sublease the cars to customers through its online platform.

The collaboration is intended to provide the group with an additional income stream by monetising its unsold inventory, MeGroup said. It is not expected to have any material impact on the group for the current financial year ending March 31, 2020.

As the agreement is based on the number of customer requests Flux receives, MeGroup said it cannot be certain of the expected financial impact of the collaboration for the financial year ended March 31, 2020.

MeGroup currently has six car brands – Mazda, Honda, Peugeot, Hyundai, Ford and Mitsubishi – and nine dealership outlets in its portfolio.

Jeffrey Wong, head of growth and expansion and head of dealerships at MeGroup, said Flux has already secured customers for its cars and MeGroup hopes to "begin this leasing service as soon as it can".

MeGroup shares closed unchanged at 18.5 Singapore cents on Monday before the agreement was announced.