KUALA LUMPUR (Feb 19): Boustead Holdings Bhd announced today it is disposing of its Royale Chulan Bukit Bintang Hotel business to Singapore-based Hotel Royal Ltd for RM197 million.

Boustead's wholly-owned unit Boustead Hotel & Resorts Sdn Bhd has accepted the offer from Hotel Royal today, the group informed in a Bursa Malaysia filing.

In December, The Edge Malaysia wrote, quoting a Boustead spokesman, that the group was seeking bidders for the 21-year-old asset, which is located on two parcels of freehold land in Kuala Lumpur measuring approximately 3,189 square metres.

Today, Boustead said as part of the terms in the Letter of Offer, Hotel Royal is granted an exclusivity period of one month to conduct a due diligence on the hotel.

Additionally, Boustead shall refrain from responding (other than to reject) to any enquiry or offer from any other parties during this exclusivity period.

"The purchaser had paid a sum of RM3.94 million, being the 2% earnest deposit of the disposal consideration, as part of the terms of the Letter of Offer," it said.

Boustead added that in the event that the sale and purchase agreement is not executed for any reason whatsoever, the earnest deposit shall be refunded in full to Hotel Royal within 14 days from the date of its written demand to Boustead.

Boustead closed down one sen or 0.68% to RM1.47, for a market capitalisation of RM2.98 billion. The stock has halved over the past one year.