Yong Tai calls off plan to develop RM168mil U-Thant project

Yong Tai Bhd's The Apple and the Courtyard By Marriott mixed development project is scheduled for completion in 2017.

KUALA LUMPUR: Yong Tai Bhd has scrapped its plan to take part in developing a 128-unit luxury apartment block along Jalan U-Thant, Kuala Lumpur, which has a gross development value of RM168mil.

The property developer told Bursa Malaysia that it decided not to proceed with the RM3mil proposed purchase of the entire equity interest in Yuten Development Sdn Bhd, which is jointly undertaking the project on 1.2 acres with Fahad Holdings Sdn Bhd.

Yong Tai said it had been notified of the conditional approval letter from Kuala Lumpur City Hall dated Nov 2, 2015 received by Yuten in relation to the application for the development order for the U-Thant project.

“One of the conditions imposed is that the density of the U-Thant project is lower than the density stipulated in the condition precedent of the Yuten share sale agreement (SSA),” it said.

One of the conditions precedent under the conditional SSA signed in October last year is for the Yuten vendors to secure the development order for the U-Thant project comprising 128 condominium units.

“After careful consideration, the board had decided not to proceed with the proposed acquisition of Yuten and consequently on Jan 19, 2016, Yong Tai and the Yuten vendors have agreed to mutually terminate the Yuten SSA with immediate effect via a mutual termination letter,” the company said.

Based on Yong Tai’s announcement last October. it may potentially derive a pre-tax return of RM20.5mil from the three-year U-Thant project, being 50% of its profit entitlement on the estimated profit of about RM41mil.

Yong Tai shares added 2.5 sen to close at 77 sen on Tuesday, with 1.475 million shares changing hands.