In a filing with Bursa Malaysia yesterday, Oriental Interest announced that its 70%-owned subsidiary, Myra Land Sdn Bhd, has entered into a sale and purchase agreement with Makmur Asiamaju Sdn Bhd to purchase the vacant land equivalent to 505,688.51 sq ft.
The group has said that the purchase price of RM46.78mil will be satisfied by either internally generated funds or bank borrowings, or a combination of both.
“The proposed acquisition is in line with the group’s strategic planning to leverage on the group’s strengths in property development and construction to develop the land complementary to the group’s existing development in Sepang, Selangor.
“The proposed acquisition is also in line with the group’s overall plan to increase its land bank in favourable areas (where the group can leverage on its extensive experience in building mixed-use developments) given the opportunities available in the current market conditions,” Oriental Interest pointed out in the stock exchange filing.The group said the acquisition will not have a material effect on its net assets, gearing and earnings for the financial period from July 1, 2019 to Aug 31, 2020.
“However, it is expected to contribute positively to the future earnings of the group,” it said.
While the land deal does not require shareholders’ approval, it will need to obtain approval from the Economic Planning Unit of the Prime Minister’s Department as the vendor, Makmur Asiamaju, is a bumiputra company and the purchase price of the land has exceeded RM20mil.
The proposed acquisition is expected to be completed within the next eight months.