PETALING JAYA: Sunway Bhd is acquiring 20 acres of land from JAKS Resources Bhd and Concept Housing Development (M) Sdn Bhd for RM230.59 million.
In a filing with Bursa Malaysia yesterday, it said its unit Sunway Supply Chain Enterprise Sdn Bhd (SSCE) entered into an agreement with Premier Place Property Sdn Bhd (PPP), a wholly-owned subsidiary of JAKS Resources Bhd, to acquire 14.8 acres of Subang land for RM167.59 million or RM260 per sq ft (psf).
Sunway said the buy will provide the group with immediate access to four industrial lot use as warehouses and storage facilities in the immediate term by its trading and manufacturing businesses of the group. Any access capacity will be leased out.
“In the medium-term, Sunway plans to redevelop the land, which is strategically located for mixed use development,” it said, adding that the land’s strategic location and easy access to major highways will minimise transportation costs to clients.
In the longer term, the land will serve as valuable landbank for the property development division as it is close enough to Sunway City to be an extension of the group’s township. The land is also well served by amenities like malls and public transportation.
“It is estimated that the gross development value (GDV) for the future developments on the land will potentially be at least RM1.4 billion,” it added. The four parcels of land are located in USJ 1, Subang Jaya.
Sunway will fund the proposed acquisition through bank borrowings and internally generated funds.
JAKS Resources CEO Andy Ang Lam Poah said the exit from non-core assets and focus on utility and infrastructure projects are the key pillars of its corporate strategy.
He said the transaction, which is subject to approval from shareholders, will allow it to redeploy capital into reducing debt, support working capital needs and as capital reserves for future investment opportunities.
In addition to the four parcels of land, Sunway’s subsidiary Daksina Harta Sdn Bhd is acquiring 5.2 acres of freehold land in Kajang from Concept Housing Development (M) Sdn Bhd for RM63 million or RM274 psf.
The acquisition includes partially completed structures, which Sunway intends to continue building on but will replace the original development with a mixed development comprising retail podium/commercial lots and serviced apartments/SOHO units.
The indicative GDV of the proposed development is RM460 million and will take five years to develop. The proposed project is expected to be a transit oriented development due to its proximity to Sg Jernih MRT station.
The acquisition will be funded with bank borrowings and/or internally generated funds and will be completed by February 2018.
Sunway’s shares rose 1.64% to close at RM4.35 with a total of 3.92 million shares traded, giving it a market capitalisation of RM8.90 billion.
SOURCE: The Sun Daily