KUALA LUMPUR: Seacera Group Bhd is proposing to acquire the entire equity interest in property firm Duta Nilai Holdings Sdn Bhd (DNHSB) for a total cash consideration of RM220mil.
In a filing with Bursa Malaysia on Wednesday, the company’s wholly owned subsidiary Seacera Properties Sdn Bhd entered into a conditional sale and purchase agreement with Ismail Othman and Zainab Mansor who collectively own DNHSB.
DNHSB is the holding company for Duta Skyline Sdn Bhd (DSSB) which owns a 250.24 acres in Ulu Langat, Selangor. Its principal activities are in real estate, property management and investment holding.
The deal will be satisfied in two transactions. The first is a cash payment of RM4.4mil upon completion of the share purchase agreement while the second will be a deferred cash payment of RM215.6mil to be paid by Seacera Properties commencing from the second to the ninth anniversary of the agreement’s completion.
According to Seacera, the purchase consideration of RM220mil was arrived at on a willing-buyer willing-seller basis after taking into consideration the market value of DSSB’s landbank of about RM392.4mil. Meanwhile, DHNSB and DSSB’s respective net liabilities for the financial period ended March 31, 2016 amounted to RM37.26mil and RM124.31mil.
Explaining its rationale for the deal, Seacera said it was part of the company’s business diversification strategy.
“Apart from focusing and growing its manufacturing and trading of homogeneous and ceramic tiles and trading of other building materials, the group is continously looking for opportunities in property development activities in line with its diversification into the sector in 2015,” it said.
The proposed acquisition of DNHSB presents Seacera with an opportunity to increase its landbank with minimal upfront cash outflow. The deferred payment arising from the balance purchase price enables it to manage the cashflow better for the development of the land held by DNHSB and to make the payment from the proceeds of the said development, it continued.
The proposed deal is subject to shareholders’ approval at an EGM to be convened at a later date, it said.
Seacera shares increased 2.5 sen to 88 sen at Wednesday’s close.
In a filing with Bursa Malaysia on Wednesday, the company’s wholly owned subsidiary Seacera Properties Sdn Bhd entered into a conditional sale and purchase agreement with Ismail Othman and Zainab Mansor who collectively own DNHSB.
DNHSB is the holding company for Duta Skyline Sdn Bhd (DSSB) which owns a 250.24 acres in Ulu Langat, Selangor. Its principal activities are in real estate, property management and investment holding.
The deal will be satisfied in two transactions. The first is a cash payment of RM4.4mil upon completion of the share purchase agreement while the second will be a deferred cash payment of RM215.6mil to be paid by Seacera Properties commencing from the second to the ninth anniversary of the agreement’s completion.
According to Seacera, the purchase consideration of RM220mil was arrived at on a willing-buyer willing-seller basis after taking into consideration the market value of DSSB’s landbank of about RM392.4mil. Meanwhile, DHNSB and DSSB’s respective net liabilities for the financial period ended March 31, 2016 amounted to RM37.26mil and RM124.31mil.
Explaining its rationale for the deal, Seacera said it was part of the company’s business diversification strategy.
“Apart from focusing and growing its manufacturing and trading of homogeneous and ceramic tiles and trading of other building materials, the group is continously looking for opportunities in property development activities in line with its diversification into the sector in 2015,” it said.
The proposed acquisition of DNHSB presents Seacera with an opportunity to increase its landbank with minimal upfront cash outflow. The deferred payment arising from the balance purchase price enables it to manage the cashflow better for the development of the land held by DNHSB and to make the payment from the proceeds of the said development, it continued.
The proposed deal is subject to shareholders’ approval at an EGM to be convened at a later date, it said.
Seacera shares increased 2.5 sen to 88 sen at Wednesday’s close.
* See also Seacera to quadruple capacity in five years
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