KUALA LUMPUR: Parkson Holdings Bhd
(PHB) said its 54.97 per cent-owned subsidiary, Parkson Retail Group Ltd (PRGL), has terminated a tenancy agreement involving a property in Guiyang City, Guizhou Province, China.
In a filing with Bursa Malaysia, PHB said PRGL made the announcement to The Stock Exchange of Hong Kong Ltd (HKEX) relating to the termination of the tenancy agreement dated March 29, 2024, covering Basement Level 1 and Levels 1 to 4 at the Longgang International Center, Guiyang City.
The termination, effective Nov 30, 2025, was agreed between Guizhou Shenqi Parkson Retail Development Co Ltd (sub-tenant), an indirect non-wholly-owned subsidiary of PRGL, and Guizhou Longgang Commercial Operation Management Co Ltd (tenant A) and Guizhou Yuncui Property Management Co Ltd (tenant B).
PRGL said that pursuant to the International Financial Reporting Standard 16 (IFRS 16), the termination would require the group to derecognise the property as a right-of-use asset amounting to RMB51.2 million (RM30.2 million).
"Thus, the entering into of the Tenancy Termination Agreement and the transactions contemplated thereunder will be regarded as a disposal of asset by PRGL group under the Rules Governing the Listing of Securities on The HKEX (Listing Rules)," it said.
PRGL said the tenancy termination followed the inability to carry out renovation works on the property, which meant the tenancy term had not commenced.
"The board is of the opinion that the tenancy agreement should be terminated as renovation works on the property could not be carried out and as a result, the sub-tenant is unable to operate its department store at the property,” PRGL said.
It said that the terms of the tenancy termination agreement are fair and reasonable and in the interests of the company and shareholders as a whole.
Additionally, the termination would not have any material adverse impact on the financial position and operation of the group.
PRGL said all applicable percentage ratios under Rule 14.07 of the Listing Rules are less than five per cent, and the transaction does not constitute a notifiable transaction under Chapter 14.
The sub-tenant is also deemed an insignificant subsidiary, and the transaction does not constitute a connected transaction. - Bernama
