KUALA LUMPUR (Aug 23): Encorp Bhd, whose major shareholder Federal Land Development Authority (FELDA) is looking to dispose of its stake, saw its shares trading higher today.

The counter opened four sen higher at 33 sen. On market close, it trimmed some gains to settle at 31.5 sen, up 2.5 sen or 8.62%, after 7.03 million shares were traded.

The rise in the property developer’s share price was in line with Bursa Malaysia’s overall uptrend today on positive political developments and expectations of higher corporate earnings.

The Edge Malaysia reported that FELDA is looking at exiting Encorp with an asking price of RM1 a share.

The plantation giant was also reportedly eyeing to sell a block of shares to a bumiputera entrepreneur who could turn things around, and in turn, if the share price picks up, FELDA would exit the company.

FELDA has a 69.14% stake in Encorp, which based on its closing price of 29 sen last Friday (Aug 20), is worth RM57.15 million.

In May 2014, through its unit Felda Investment Corp Sdn Bhd, FELDA bought a 49.5% stake in Encorp for RM239.72 million or RM1.55 a share from Tan Sri Mohd Effendi Norwawi. FELDA ended up with a 72.27% stake after forking out a total RM306.11 million.

However, an analyst said there could be too many hurdles for a sale to happen anytime soon.

“First, I don’t know anyone who is willing to part with that sort of money on a property development company, especially now, when things are so glum. Second, it will have to be a bumiputera company that FELDA sells it to — FELDA is not just going to sell to anyone. Third, what is in Encorp?” he said.

According to its FY2020 annual report, Encorp’s key assets were Strand Mall valued at RM164 million and Red Carpet Avenue valued at RM136.69 million.

Encorp also has 15 office suites and 518 car park bays in Kota Damansara valued at RM26.02 million; 65 residential apartments, 16 retail shops and 316 car park bays in Johor Bahru valued at RM56.54 million; parcels of land in Shah Alam valued at about RM23.5 million; three apartments in Victoria Park, Western Australia, valued at RM14.78 million; and 2.7 acres in North Lake Road, Cock Burn Central, Western Australia, valued at RM8.5 million.