KUALA LUMPUR: IJM Corp Bhd aims to secure another RM1 billion worth of construction projects to grow its order book to a record RM7 billion by the start of financial year ending March 31, 2016 (FY16), from its current size of over RM6 billion.

IJM Corp chief executive officer (CEO) and managing director Datuk Teh Kean Ming said the group is targeting to secure those projects before end-FY15. 

He said the group had pre-qualified for the tender of the KL118 development, formerly known as Warisan Merdeka, and could also be tendering for the Klang Valley Mass Rapid Transit 2 project when bidding commences.

“We have over RM6 billion contracts, [if] plus another RM1 billion, I think our order book could potentially reach RM7 billion by the start of FY16,” Teh told reporters after the group’s extraordinary general meeting (EGM) yesterday.

He said the RM7 billion orders should keep the group busy for the next three to four years.

At the EGM yesterday, IJM Corp’s shareholders “unanimously” passed the resolution for the privatisation of IJM Land Bhd for a total consideration of RM1.98 billion, to be satisfied by an issuance of 280 million shares amounting to RM1.86 billion and cash consideration of approximately RM0.12 billion.

“We are pleased to say that the resolution was unanimously carried out, with 927 million shares voting for the privatisation exercise,” said Teh.

Post-privatisation, Teh sees IJM Land being able to take on larger-scale projects, while leveraging on IJM Corp’s financial strength and resources.

IJM Land currently has 4,900 acres (1,983ha) of undeveloped land bank, with a gross development value (GDV) of RM30 billion.

“We already have the land bank. Now we want to work on a larger scale in terms of capacity and financial strength,” said Teh.

In 2015, IJM Land CEO and managing director Datuk Soam Heng Choon said the company will be embarking on phase two of The Light Waterfront project in Penang, phase five of Bandar Rimbayu in the Klang Valley, 176 shop offices in Seremban 2, and Sebana Cove and Nasa City in Johor.

He said IJM Land has launched projects worth RM2 billion in GDV since the start of its current financial year, leaving the company with a balance of RM1 billion worth of projects to be launched in January.

He said the company is looking into property investment as a new business segment, leveraging on the stronger financial position of the group post-acquisition.

“With the stronger balance sheet that we have, we can actually restrategise our business. We could probably start another sector on property investment to leverage on the yield income, rather than purely property development,” said Soam.

He said the property investment business would not take a real estate investment trust structure, as the company would invest in its own assets.

There is no fixed timeline yet for the new business segment, Soam said.

IJM Corp closed unchanged at RM6.59, with a market capitalisation of RM9.82 billion, while IJM Land rose eight sen or 2.42% to RM3.38, translating into a market cap of RM5.27 billion.

This article first appeared in The Edge Financial Daily, on January 9, 2015.