Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (Oct 28): Texchem Corporation Sdn Bhd, a 73.81%-owned subsidiary of Texchem Resources Bhd, will purchase Wisma Texchem and the land occupied by the industrial complex in Subang Jaya, which it once owned, from Amanah Raya Bhd for RM19.95 million.

In a filing with Bursa Malaysia today, Texchem said Amanah Raya had agreed to sell the property in a letter dated Oct 19, 2015.

Texchem Corp owned the properties and sold them to Amanah Raya in June 2005 with a leaseback arrangement coupled with an option to buy back at the purchase price.

Texchem said the acquisition will be satisfied in cash, whereby 25% will be funded via internally generated funds and 75% will be financed with bank borrowings of Texchem Corporation.

The purchase is expected to be completed by the fourth quarter of this year, with full payments to be made by Oct 30.

Texchem said there are no liabilities to the acquisition, including contingent liabilities, and guarantees to be assumed by the company, except for a corporate guarantee of RM15 million to be issued by the company in relation to the banking facilities obtained by Texchem Corp to finance the acquisition.

The 2.03ha land currently houses a three-storey office building, three blocks of single-storey warehouse building and other ancillary buildings.

The company said the acquisition will enable the group to save on future lease or rental payments.

Currently, the property is used as the group's central region headquarters, occupied by the company's subsidiaries and associated companies.

After the acquisition, the group and two associated companies shall continue to occupy the property for their business operation.

"The property is located in a prime locality in the Klang Valley with a great potential for future capital appreciation and for future development," the filing read.

"The purpose of the acquisition of the property is for the internal usage by the group of companies and hence, any fluctuation of the property price and market demand for rental space is not relevant," it added.

Texchem shares closed two sen or 1.32% lower at RM1.50, with a market capitalisation of RM186.15 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.)

 

      Print
      Text Size
      Share