In a filing with Bursa Malaysia, Tropicana said its special-purpose vehicle (SPV) Tropicana Danga Senibong Sdn Bhd (formerly known as Renown Dynamic Sdn Bhd) had exercised its right to terminate the sale and purchase agreement (SPA) signed on Dec 23, 2013, as the conditions precedent were not fulfilled in accordance with the SPA’s provisions.
The developer, however, did not detail the provisions that have not been fulfilled.
In December 2013, Tebrau Teguh Bhd had proposed the establishment of a joint venture with Golddust United Sdn Bhd, a wholly owned unit of Tropicana, to jointly develop the said land in Mukim Plentong, Johor Baru,
The SPV, Renown Dynamic, will acquire the land, which is partially under water and needs to be reclaimed, for RM444.3mil from Tebrau Teguh.
Tebrau Teguh will hold 30% in the SPV, which will develop the leasehold land, while 70% will be taken up by Golddust United.
Tropicana had then said that the proposals were in line with the company’s objective of increasing land bank at strategic locations, especially in Johor, for its future property development and property investment activities in the region.
In a statement to Bursa Malaysia, IWC said following the termination from Tropicana, the proposals had been aborted.
IWC is 47%-owned by Iskandar Waterfront Holdings, the master developer of 4,000 acres of prime waterfront land in southern Johor, stretching from Danga Bay on the west of Johor Baru to the Tebrau Coast on the east.
It is not certain if market conditions had any bearing on the termination. Some developers have been reviewing their strategy and investing more in the Klang Valley due to a subdued property market. There are many large-scale property development projects launched by developers from China in Johor.
Country Garden Holdings Co Ltd launched about 9,400 condominium units in 2013 in Danga Bay. It was reported that 6,400 units had been sold. It plans to build more units on that 57.11 acres of reclaimed land.
In the second quarter of this year, state-owned Greenland Holding Group Co Ltd reportedly bought 3,000 acres of industrial land in addition to 140 acres, also in Johor.