IW City suspended after MoF calls off deal, Ekovest under pressure - Business News | The Star Online


IW City suspended after MoF calls off deal, Ekovest under pressure

KUALA LUMPUR: Trading in the securities of Iskandar Waterfront City Bhd (IWCity) is believed to have been voluntarily suspended on Thursday after the Ministry of Finance (MoF) called off the Bandar Malaysia deal.

However, another related company, Ekovest saw its share price falling to a low of RM1.01 after the disappointing news.

At 9.04am, Ekovest was down 19 sen to RM1.24 with 34.15 million shares done.

The FBM KLCI fell 7.33 points or 0.41% to 1,765.18. Turnover was 158.25 million shares valued at RM79.77mmil. There were 89 gainers, 182 losers and 239 counters unchanged. 

IWCity’s parent is Iskandar Waterfront Holdings Sdn Bhd (IWH). IWH’s joint venture with China Railway Engineering Corp (M) Sdn Bhd (CREC) was affected by the MoF’s TRX City Sdn Bhd move to declare that the share sale agreement had been aborted.

TRX City had on Wednesday announced the agreement entered between the Government through TRX City with the JV had lapsed.

The stock, which was at its highest at RM3.22 on Tuesday, ended yesterday with more than 13.35 million shares being traded. 

On a year-to-date basis as of Tuesday’s price, IWC was up a staggering 282.61%.

The upward trajectory has been mainly due to the euphoria on IWH taking over the listing status of IWC. 

The value creation seen by investors was that the listed company would sit on prime Bandar Malaysia land. 

Bandar Malaysia is the crown jewel, a 20-year development plan spanning over 483 acres located right in the heart of Kuala Lumpur with a gross development value of some RM200bil.

Hence, IWC shares were viewed as a long-term proxy for the appreciation of central business district land in Johor Baru and Kuala Lumpur by Credit Suisse recently.

It was also referred to as the world’s best-performing small-cap stock this year, as the property company announced plans to raise as much as RM5bil via convertible bonds, mainly to develop the real estate that it’s acquiring, according to executive vice-chairman Tan Sri Lim Kang Hoo in April.

In March, it was announced that IWC was the target of a reverse takeover by Lim and his business associates, including the Johor Sultan, where the new-look IWH would have a total of 7,400 acres of land. 

This is equivalent to about nine times New York City’s Central Park.

At the point of takeover, the stock was valued at 3.7 times its book value, excluding the land acquisitions via the takeover.