KUALA LUMPUR: With Genting Malaysia Bhd
's termination of the exclusive arrangement with Smart Miami City LLC for the latter to purchase the Miami Herald land, the bidding for the property has now been reopened to other parties.
Kenanga Research said that with Smart Miami continuing to show interest in the purchase, Genting Malaysia may be hoping for better prices by reopening the sale bidding.
"It is unclear whether other or better offers have been secured but given the prime location, securing an acceptable price might be the issue rather than lack of buyers," it said in a note.
However, the research firm noted that the delay carries a risk as the US real estae sector is facing higher borrowing costs and a slower economy.
On April 27, 2023, Genting Malaysia announced that its wholly-owned subsidiary Resorts World Miami LLC was selling four parcels of land in Miami to Smart Miami for US$1.22bil (RM5.43bil) cash.
Subsequently, Smart Miami opted to acquire RW Miami, which owns the land.
In a filing with Bursa Malaysia yesterday, Genting Malaysia announced that Smart Miami had ended its ongoing bid after Genting Malaysia did not agree to extend the exclusive period and amend some commercial terms.
Post-announcement, Kenanga retained its FY23-24 forecast earnings as the sale had not been factored into its earnings when it was first announced.
It maintained "outperform" on the stock with a target price of RM3.35.
"We continue to like 'Genting Highlands' as a proxy to the reopening of international borders and rebound in the tourism industry, especially the influx of tourists from China even if footfall has been slower than earlier expected," it said.
