KUALA LUMPUR, April 19 — Mutiara Rini Sdn Bhd, a wholly-owned indirect subsidiary of Boustead Holdings Bhd has entered into a sale and purchase agreement with Sunway Rahman Putra Sdn Bhd for the proposed disposal of 2.67 hectares of freehold land in Jalan Cochrane for RM233.39 million.
In a filing with Bursa Malaysia today, the group said the proposed disposal is on a “willing-buyer, willing-seller” basis, taking into consideration the market value of the land, which stands at RM220 million or RM766.50 per square foot.
The proposed disposal provides Boustead an opportunity to unlock and realise its investment at a favourable price due to the land’s location, potential, easy accessibility, ready amenities and infrastructure.
“Upon completion of the proposed disposal, the group is expected to realise an estimated gain on disposal of approximately RM54.1 million, allowing the group to strengthen its liquidity and cash flow position by raising total net cash proceeds of approximately RM213.8 million.
“Part of the proceeds from the disposal, amounting to RM101 million, will be used to repay bank borrowings, which will result in interest saving of RM4.5 million per annum and is expected to reduce the gearing ratio of Boustead,” it added.
In a separate statement today, Sunway Property said the land acquisition was for proposed mixed development comprising serviced apartments and retail with gross development value (GDV) of at least RM1.15 billion.
“The development encompasses Sunway Velocity Mall, a one-million square feet net lettable area shopping mall, Sunway Velocity Hotel, a 350-room hotel, Sunway Medical Centre Velocity, a 240-bed medical centre, Sunway College @ Velocity, two office towers with a total floor area of 375,000 square feet and residential units,” it said.
According to the property developer, the acquisition would strengthen the company’s presence in this vicinity given that the site is directly across from Cochrane Mass Rapid Transit (MRT) station and just one station away from Tun Razak Exchange (TRX).
Sunway Property said the deal is the company’s second landbank acquisition for the year, reflecting its confidence in the recovery of the property market in the coming years.
“Currently, Sunway’s total landbank stands at 1,351.25 ha with a potential gross development value of RM52.1 billion over a total development period of more than 15 years,” it said. — Bernama