KUALA LUMPUR (Feb 10): WZ Satu Bhd is acquiring a PR1MA housing project’s construction company from funeral service provider Nirvana Asia Ltd’s founder-cum-executive chairman Tan Sri Kong Hon Kong and deputy chief executive officer Kong Yew Foong for RM30 million, to be satisfied via issuance of shares.

In a filing with Bursa Malaysia, WZ Satu said it entered into a conditional share sale agreement with Hon Kong and Yew Foong to acquire 500,000 shares or the entire equity interest in the abovementioned company, called Cekap Semenanjung Sdn Bhd.

Hon Kong owns 499,999 shares in Cekap Semenanjung while the remaining one share is owned by Yew Foong.

After the acquisition, Hon Kong is expected to hold 7.8% direct interest in WZ Satu.

Cekap Semenanjung is the beneficial owner of entire equity interest in Sinergi Dayang Sdn Bhd, which is principally involved in carrying out construction works.

Sinergi Dayang’s sole project is the design, finance, construction, development and completion of a Perumahan Rakyat 1Malaysia (PR1MA) development located in Kuantan, Pahang.

The project is being undertaken pursuant to a Master En-Bloc Purchase Agreement dated March 18 last year, entered into between PR1MA Corp Malaysia, Sinergi Dayang as the contractor and Barisan Arena Sdn Bhd as the proprietor.

It is a mixed development comprising 2,426 PR1MA homes and 69 retail units and its construction contract value amounts to RM503.2 million.

The project is expected to commence by the second quarter of this year, with a construction period of 36 months.

WZ Satu will be issuing 29.41 million shares to Hon Kong and Yew Foong at the issue price of RM1.02.

The group said the proposed acquisition represents an initiative to expand its order book by securing a PR1MA development project, which if completed, will increase its order book to about RM1.4 billion.

As at financial year ended Aug 31, 2016 (FY16), WZ Satu said its order book stood at RM931.8 million, comprising of infrastructure-related projects, which should be able to keep it busy for the next two to three years.

“Notwithstanding the sizeable order book, the group continues to seek and evaluate opportunities, both organic and inorganic, to secure new civil engineering and construction contracts and grow its order book,” it said.

WZ Satu expects to complete the corporate exercise by the third quarter of this year.

The group’s share price closed unchanged at RM1.17 today, giving it a market capitalisation of RM408.17 million.