KUALA LUMPUR: O&C Resources Bhd (OCR) plans to develop a service apartment block with an estimated gross development value of RM204.94mil within the vicinity of the Petronas Twin Towers.
In a filing with Bursa Malaysia, the rubber products maker (formerly Takaso Resources Bhd) said it had bought a 51% stake in Masbe Coffee Sdn Bhd (MCSB), which has the rights to develop a 1,492 sq metre freehold land at Jalan Yap Kwan Seng, for RM5mil.
Based on the principal development order (DO) for the land, the approved type of development is a 145-unit service apartment. However, MCSB may apply for a revision of the DO on finalisation of a new joint-venture (JV) agreement between MCSB and the land’s legal owner, Makok Intl Sdn Bhd (MISB).
OCR bought its 51% stake in MCSB from MISB, which had last December entered into a JV agreement with MCSB to develop the land into a residential, commercial or mixed development project.
Currently there is a three-storey residential property on the land which will be demolished.
OCR said the acquisition was in line with its strategy to grow and diversify its business operations to turn profitable with sustainable growth as well as to balance its income stream from non-traditional sources so as to lessen any future negative industry impact to its traditional business industry.
It said the group’s current businesses were very much dependent on global demand trends and economic outlook and the acquisition would balance out the over-reliance on this.
In a press statement, OCR executive director Billy Ong Kah Hoe said the proposed development was expected to start within one year from the execution date of the new JV agreement and the development period would be over three years.
The estimated gross development cost for the proposed development is RM94.49mil, which the company plans to raise through a combination of fund-raising exercise, internally generated funds and bank borrowings.