Friday 29 Mar 2024
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KUALA LUMPUR: Gabungan AQRS Bhd has teamed up with Suria Capital Holdings Bhd to jointly develop a mixed development in Jalan Tanjung Lipat in Kota Kinabalu, Sabah, which will have a net sale value (NSV) of RM1.8 billion.

In a filing with Bursa Malaysia, Gabungan AQRS (fundamental: 1.3; valuation: 1.8) said it had signed a joint-venture (JV) agreement with Suria Capital for the proposed development yesterday.

In a joint statement, Gabungan AQRS and Suria Capital said that under the JV, Suria Capital (fundamental: 2.3; valuation: 1.8) will be entitled to 18% or up to RM198 million of the total NSV of the project and Gabungan AQRS the remaining 82%.

“There will be both cash and in- kind considerations whereby there will be an initial cash payment of RM12 million, followed by a payment in kind valued at RM166.4 million to be settled three years following the execution of the initial cash consideration.

“On the fifth anniversary of the completion of the payment in-kind transaction, there will be a final cash payment of RM19.6 million or the balance 18% of the total NSV for the project, whichever is higher,” Gabungan AQRS and Suria Capital said in the statement.

Called One Jesselton Waterfront, the development will comprise residential units, retail units, office towers, a shopping mall, Suria corporate offices, serviced suites, serviced apartments and car parks.

The shopping mall, to be called One Jesselton Mall, will have a net floor area (NFA) of 473,795 sq ft, while Suria corporate offices will have a NFA of 74,487 sq ft and the retail lots, to be named Suria Retail, will have a NFA of 74,892 sq ft.

“Additionally, the development will also include serviced suites and apartments, a condominium as well as car park facilities, and a ferry ticketing office,” the two companies said.

The 7-acre (2.83ha) parcel of land is part of the 23.25 acres allocated to Suria Capital by the Sabah state government as part of a 99-year concession for the privatisation of seven major ports in Sabah in 2003.

“The land lease is for a period of 99 years, commencing Jan 1, 2010 until Dec 31, 2108. The land has been left vacant since the relocation of the container operation to Sapangar Bay in 2007,” said Gabungan AQRS in the filing.

The JV is conditional upon Suria Capital obtaining the approval of the Sabah director of the Land and Survey Department for the development land and Gabungan AQRS getting the approval from the relevant authorities for the development and building plans for the proposed project.

“Gabungan AQRS shall make the necessary submission to the relevant authorities within a period of three months from the date of the JV agreement,” it added.

In a separate filing, Suria Capital said the proposed project is expected to be completed within six years. 

“The development will further strengthen the property division of Gabungan AQRS, which is one of our twin growth engines, adding to our asset base and providing a substantial recurring income stream upon completion,” said Gabungan AQRS executive director Datuk Azizan Jaafar.

“Combined with the upcoming launches of Phases 2 and 3 of a 14.3-acre development in Kinrara Uptown as well as a 2.7-acre project in Damansara Perdana, we are optimistic about continuing to strengthen our position in the market,” he added.

Suria Capital chairman Datuk Faisyal Yusof Hamdein Diego said One Jesselton Waterfront will complement the proposed international cruise terminal that is poised to be an iconic landscape as the city’s premier tourism frontier catering for both local and foreign tourists.

Gabungan AQRS shares closed up 2.21% at RM1.39 yesterday, giving a market capitalisation of RM527.4 million. Suria Capital’s share price was down 0.43% to settle at RM2.32, bringing a market cap of RM660.15 million.


The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuation.

 

This article first appeared in The Edge Financial Daily, on March 17, 2015.

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