This article first appeared in The Edge Financial Daily on June 11, 2019

KUALA LUMPUR: Scientex Bhd is expanding its land bank for property development.

In a filing to Bursa Malaysia yesterday, Scientex said its subsidiary, Scientex (Skudai) Sdn Bhd, has signed a sale and purchase agreement with Palma Indah Sdn Bhd to buy six parcels of freehold land from the latter for RM109.59 million cash to build affordable homes.

The acquisition will be funded by internally-generated funds, bank borrowings and/or the issuance of Sukuk Murabahah under its existing Sukuk Murabahah programme.

The land purchase is expected to be completed in the first half of 2020.

Last month Scientex announced it bought two pieces of land worth RM123.28 million to develop affordable homes.

Besides, the group’s wholly-owned unit, Scientex Heights Sdn Bhd, is collaborating with the Melaka Housing Board to develop a 78.08-hectare mixed residential development valued at RM438.72 million in Durian Tunggal, Alor Gajah, Melaka.

Scientex, which is also involved in plastic packaging materials, yesterday said the land purchase was in line with its strategy to expand northwards in Peninsular Malaysia, and will provide an adequate land bank to sustain property developments over the medium and long term.

It added that the expansion also fits in with the group’s plans to build more affordable housing — with the group ultimately aiming to build 50,000 affordable homes nationwide by 2028.

The acquisition is not expected to have any material impact on the group’s earnings, paid-up share capital, earnings and net assets for the financial years ending July 31, 2019 and 2020, it said.