KUALA LUMPUR: The Employees Provident Fund Board (EPF) is subscribing for a 20% stake in a joint venture company which will acquire the Battersea Power Station in London for £400mil (RM1.972bil) while the estimated gross development value (GDV) for this project is close to £8bil (RM39.4bil).
Sime Darby and S P Setia Bhd announced on Thursday that they would each take a 40% stake in the JV company Battersea Project Holding Company Ltd that would acquire the property.
The EPF would subscribe for its 20% stake in the JV company via its unit Kwasa Global (Jersey) Ltd.
Battersea Project Holding Company, through its unit, Battersea Project Land Company Ltd, had on Wednesday entered into a contract to acquire the property.
Sime Darby said the parties agreed that the purchase consideration of the property would be £400mil and the estimated project development cost for the two-year period would be £200mil (RM986mil).
"The project spans over approximately 15 years and it is envisaged that the property will be a mixed residential and commercial development involving amongst others, private residential units, serviced apartments, office, retail, food & beverage and hotel. The estimated GDV for this project is close to £8bil (RM39.4bil)," it said.
Sime Darby said the JV was part of the group's strategy to embark on niche developments in high growth international markets.
"It is an opportunity to take advantage of a distressed situation in partnership with S P Setia, a like-minded, reputable and financially sound property developer with a strong and loyal customer base," it said.
Sime Darby said the JV would provide a formal working relationship between Sime Darby, S P Setia and EPF, enabling the parties to leverage on each other's strengths in executing the project.
"It is expected that the JV will be crucial in driving Sime Darby to achieve amongst others, a 20% income contribution from overseas operations for the Sime Darby Group's property division by 2016. In addition, the acquisition will help increase the Sime Darby Group's focus in niche developments in high growth markets international markets," it said.
Sime Darby said the group had identified London as an important target destination with sound fundamentals in both the commercial and residential property markets.
It expected the project to see strong capital growth on the back of regeneration plans with improved transportation facilities.
"The scale of the development creates the opportunity to evolve and respond to changes in life cycles and thereby increase the value of the development," it said.