PETALING JAYA, Dec 29: Property company Ewein Bhd’s unit Ewein Zenith II Sdn Bhd has inked a sale and purchase agreement (SPA) with Consortium Zenith BUCG Sdn Bhd (CZBUCG) to buy 4.42 ha of land in Penang for RM162 million.
Ewein Zenith II is a 60%-owned subsidiary of Ewein Land Sdn Bhd, a wholly-owned subsidiary of Ewein. The remaining 40% is held by construction company CZBUCG.
Previously, CZBUCG was awarded a works contract for a major road and third link (tunnel) project in Penang by the Penang state government for RM6.3 billion.
In a statement yesterday, Ewein said the proposed acquisition will be financed through a combination of internally-generated funds and bank borrowings, adding that RM16.2 million will be used as a refundable deposit upon the execution of the SPA.
“The final composition of the funding will be determined by the management of Ewein Zenith II at a later stage, and this will depend on the cost of funding and cash requirements of the group’s business operations,” it said.
The proposed acquisition is subjected to the group’s shareholders’ approval at its forthcoming EGM.
Ewein’s deputy chairman and group managing director Datuk Ewe Swee Kheng said the proposed acquisition is in line with the group’s strategy to increase its landbank, in order to expand its revenue base, particularly in the property development division.
“In light of the strategic location of the land, which is in a matured and established prime area for residential and commercial purposes, the board opines that the said land is strategic for the future development of the group,” he added.
Ewe said the acquisition is expected to be completed in the first half of the calendar year 2016.
He said the group plans to embark on residential and commercial property development on the land, which will be determined at a later stage.
“We believe that there is still much upside for the property market in Penang island given its land scarcity and various infrastructure developments in the state,” he added.
— THE SUN