KUALA LUMPUR (Oct 20): Hunza Properties Bhd is acquiring a 3.924ha piece of freehold land in Bayan Baru, Penang for RM57.02 million cash, which it intends to build affordable homes.

In a filing with Bursa Malaysia today, the Penang-based property developer said its unit, Diamaward (M) Sdn Bhd, has entered into a sale and purchase agreement (SPA) with WLB Properties Sdn Bhd for the proposed deal.

Hunza Properties said the purchase consideration was arrived at on a willing buyer-willing seller basis, after taking into consideration the market value appraised by an independent valuer, C H Williams Talhar & Wong Sdn Bhd, based on a comparison method.

"Diamaward was unable to disclose the net book value of the land, as it is not privy to such information," it added.

On funding, Hunza Properties said it will be satisfied by a combination of cash and bank borrowings.

According to the filing, the land is currently vacant and is charged to OCBC Bank (Malaysia) Bhd.

Hunza Properties is proposing to develop affordable housing accommodation on the land, but it was unable to reveal the development costs and the expected profits to be derived from the development, as the detailed development plan has yet to be finalised.

According to the property developer, it is required to build and sell affordable homes to qualified buyers, in accordance with guidelines on plot ratio usage for mixed development, approved by the Penang State Planning Committee.

WLB Properties is a private limited company incorporated in Malaysia, which principally involved in property development.

The directors are Datuk Seri Ooi Soo Hing, Ooi Soo Pheng, Heng Wooi Hin and Heng Wooi Piao; while its shareholders are Wan Lee Brothers Sdn Bhd and Tonma Development Sdn Bhd, each holding 50% equity interest in WLB Properties.

Hunza Properties expects the proposed acquisition to be completed by the first quarter of 2016.

Shares in Hunza Properties closed up two sen or 0.74% at RM2.73 today, bringing its market capitalisation to RM614.48 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.)