Ekovest signs heads of agreement with IWH


On Dec 17,2019, IWH-CREC entered into a restated and amended share sale agreement with TRX City to acquire a 60% stake in Bandar Malaysia Sdn Bhd (BMSB) from the latter.

PETALING JAYA: Ekovest Bhd has signed a heads of agreement with Iskandar Waterfront Holdings Sdn Bhd (IWH), which entails Ekovest taking up a 40% stake in a special purpose vehicle (SPV) that will in turn control a 50% interest in the master developer of Bandar Malaysia.

In addition, Ekovest will also subscribe to new redeemable preference shares (RPS) in IWH-CREC Sdn Bhd for the purposes of redeeming 40% of the existing RPS-A and RPS-B held by IWH in IWH-CREC.

The RPS subscriptions are expected to have an indicative value of RM250mil.

For perspective, IWH-CREC is the master developer of Bandar Malaysia near Sungai Besi in the capital city.

It controls a 60% stake in the project, while the Finance Ministry holds the remaining 40% equity interest.

“For avoidance of doubt, the heads of agreement will be subject to the signing of the definitive agreements to be entered into between Ekovest and IWH in relation to the proposed joint venture on a later date, ” it said in a Bursa Malaysia filing.

Ekovest also pointed out that it may use a combination of internally-generated funds and borrowings to finance the subscriptions of ordinary shares in the SPV and the RPS.

“Subsequently, Ekovest will be required to commit an additional sum of approximately RM1.23bil over a period of time until year 2023, either directly to IWH-CREC or through the SPV, to meet IWH-CREC’s remaining payment obligations under the restated and amended share sale agreement with TRX City Sdn Bhd, ” it said.

On Dec 17,2019, IWH-CREC entered into a restated and amended share sale agreement with TRX City to acquire a 60% stake in Bandar Malaysia Sdn Bhd (BMSB) from the latter.

TRX City is an indirect wholly-owned subsidiary of the Finance Ministry, while BMSB undertakes the overall master planning and development of the 16 parcels of land located in Sungai Besi.

The project is said to be able to contribute significantly to the construction sector of the country.

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