PETALING JAYA: LBS Bina Group Bhd’s indirect 70%-owned subsidiary, Leaptec Engineering Sdn Bhd (LESB) has signed a reclamation and development agreement (RDA) with the Melaka state government.
In a filing with Bursa Malaysia, LBS said the agreement was for the rights to reclaim and develop an area measuring approximately 1,200 acres located at Tanjung Bruas, Melaka.
The proposed reclaimed land will be part of the Melaka Waterfront Economic Zone (M-WEZ) which spans an area of 25,000 acres located in the coastline of Melaka.
Following the reclamation works, LBS intends to develop an industry hub with port facilities which includes logistic and warehouse, manufacturing, liquefied natural gas (LNG), port related business and such other developments or economic activities on the site.
“LBS also plans to seek smart partnership or mutually beneficial collaboration with other parties with regards to this reclamation and development project.
“This project is in line with LBS’s plans to enlarge its land banks in other states particularly in states with strong growth potential such as Melaka,” LBS said in a separate statement.
LBS said in consideration of the rights granted, the Melaka state government shall be paid a cash consideration of RM94.86mil which will be funded by internally generated funds and/or bank borrowings.
“Upon successful completion of the reclamation works, LBS shall be entitled to four-fifth of the reclaimed land whereas the state government shall be entitled to the remaining one-fifth portion of the area,” it added.
LBS executive chairman Tan Sri Lim Hock San said the RDA provided the group with an opportunity to procure sizeable tracts of lands at the coastal area of the Straits of Melaka.
“This will enable the group to establish a dominant presence in this area with access to a new market catchment, particularly in the industrial and commercial segment.
“With the group’s strong presence and foothold in Guangdong province, China, we will be able to further leverage on the ‘Friendly State and Province’ relationships between Melaka and Guangdong to explore bilateral investment corporations and establishments,” he said.
In addition, Lim said the RDA also augured well for its listed subsidiary, MGB Bhd which will benefit from potential construction works to be carried out for the project.
“We are confident that the industrial and commercial development will be well received in view of its strategic location, growing economic activities in the vicinity and supports from the Melaka state government. The project is expected to contribute positively to the future earnings of the group,” he said.