IWC to buy freehold Johor land for RM629m development

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KUALA LUMPUR: Iskandar Waterfront City Bhd (IWC) plans to acquire three adjoining parcels of freehold land in Johor Baru, which measures a collective 67.5 acres (27.3ha) for RM156 million or RM53 per sq ft for a proposed mixed development with a gross development value (GDV) of RM629 million.

IWC, in a statement to Bursa Malaysia yesterday, said the proposed mixed development on the land, which is situated within the development region of Iskandar Malaysia, has an indicative gross development cost of approximately RM480 million and will consist of residential units, Rumah Mampu Milik Johor and shop houses.

However, it said the proposed development is still in an “early stage of planning”, and that there is no “confirmed detailed information” at hand.

IWC’s (fundamental: 0.85; valuation: 0.3) wholly-owned unit Bayou Management Sdn Bhd entered into a conditional sale and purchase agreement with Bahagia Wangsa Sdn Bhd for the said acquisition yesterday.

IWC further said that the proposed acquisition is in line with its growth strategy to accumulate “new suitable land” as land bank and to enhance future earnings and revenue.

IWC is expected to fund the proposed acquisition via bank borrowings and/or internally generated funds. The proposed acquisition will also require approvals from its shareholders and the relevant state authority.

Barring any unforeseen circumstances, the proposed acquisition should be completed by the fourth quarter this year, said IWC.

It added that the proposed acquisition will also complement nearby parcels of land being developed by the group’s sister company, Danga Bay Sdn Bhd, also known as Danga Heights.

 IWC shares closed down one sen or 0.8% to RM1.32, with a market capitalisation of RM884.04 million.

 

This article first appeared in The Edge Financial Daily, on April 23, 2015.