KUALA LUMPUR (Aug 13): Takaso Resources Bhd, a company in the rubber and baby products industry which has recently ventured into the construction sector, has acquired a 37,264.66 sq ft  piece of leasehold land in Taman Melaka Raya, Melaka for RM9.32 million cash. 

The tenure of the land expires on Oct 4, 2082.

In a statement today, Takaso said its unit Tristar City Sdn Bhd has signed a conditional sale and purchase agreement with Mega Irama Enigma Sdn Bhd for the land acquisition.

Although the land was initially approved to be developed into a seven-storey budget hotel with 174 rooms, Takaso said it plans to turn the land into a mixed development with a gross development value of RM134.15 million.

"(The reason is that) it is strategically located in Taman Melaka Raya where the area has seen rapid growth and as a result, properties in the area are in high demand," it added.

Takaso also noted that the land acquisition is part of the group's strategy to continuously seek opportunities to expand and diversify its business operations to turn profitable while maintaining sustainable growth as well as to balance our income stream from our various segments.

"We believe that the venture will also lessen our dependence on our traditional businesses,” said Takaso executive director Ong Kah Hoe in the statement.

Takaso executive chairman Francis Tee said apart from this project, the group is also in the midst of negotiating with other parties for "other promising deals and projects relevant to the group".

"We believe our decision to lessen dependence on our traditional segments and to widen our income stream contribution is the right way to move forward given so many uncertainties in our country now," added Tee.

In a filing with Bursa Malaysia today, Takaso said the land acquisition will be funded by internal funds, fund raising exercise and/or bank borrowings.

Takaso is targeting to complete the deal within three months from the expiry of the unconditional date.

It is expected that the mixed development will be completed within three years from the commencement date.

Takaso (fundamental: 1.65; valuation: 0) shares closed two sen or 3.51% lower at 55 sen today, giving it a market capitalisation of RM116.45 million. 

(Note: 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 valuations.)