PSCI sells building in Penang to lower debts

PETALING JAYA: PSC Industries Bhd's (PSCI) wholly-owned unit PSC Asset Holdings Sdn Bhd has proposed to sell a building known as Menara PSCI in George Town to Boustead Holdings Bhd for RM54mil cash. 

Boustead owns a 32.5% stake in PSCI. 

“The proposed disposal provides an avenue for PSCI to realise the value of its investment and to reduce its loan obligations to regularise the financial position as part of its plan pursuant to Practice Note 17,'' PSCI said in a statement to Bursa Malaysia yesterday. 

The property is currently charged to OCBC Bank (M) Bhd for a principal loan amounting to RM67mil obtained by PSCI subsidiaries PSC Asset and Penang Shipbuilding & Construction Sdn Bhd. 

The loan has been in default.  

“Proceeds from the proposed disposal would be utilised to partially repay the outstanding loans,'' PSCI said. 

As at Dec 31, 2005, the audited net book value of the property was RM70mil. It generated a total gross income of RM5.48mil last year. 

The valuation for the disposal was arrived on “a willing buyer-willing seller basis” after taking into consideration, among other things, the building's indicative market value of RM55mil. 

“The proposed disposal is expected to result in a group loss of RM4mil for the year ending Dec 31, 2006,'' PSCI said. 

PSCI bought PSC Asset, including Menara PSCI and liabilities of RM51mil, for RM28.1mil on Nov 7, 1994. 

Boustead, controlled by Lembaga Tabung Angkatan Tentera, is working to restructure PSCI and save the multi-billion ringgit contract to build patrol vessels for the Royal Malaysian Navy. 

 PSCI :  [Stock Watch]  [News] BSTEAD :  [Stock Watch]  [News]