KUALA LUMPUR (Oct 17): KPJ Healthcare Bhd plans to develop a piece of land in Batu Pahat, Johor into a RM67.6 million hospital, to be known as KPJ Batu Pahat Specialist Hospital.
In a filing with Bursa Malaysia today, KPJ said its wholly-owned subsidiary, Puteri Specialist Hospital (Johor) Sdn Bhd, has entered into an agreement to lease a hospital building and the land from Johor Land Bhd and landowner Johor Corp (JCorp) for the proposed development.
The agreement is deemed a related party transaction as JCorp is a major shareholder of KPJ with a 44.3% stake, while Johor Land is a wholly-owned subsidiary of JCorp.
JCorp is the registered owner of the land.
The proposed hospital to be constructed on the portion of the land will be a seven-storey 90-bed hospital building, with a gross floor area measuring approximately 157,500 sq ft, and 162 car parking bays with built up area of 21,797.10 sq ft.
Johor Land will construct the proposed hospital at its own costs and expenses, in accordance with the specifications provided by Puteri Specialist. The development cost of the hospital is estimated to be RM67.6 million.
Subject to execution of the lease agreement, the monthly rental payable by the lessee (Puteri Specialist) will be a sum equivalent to one-twelfth of 6.5% of the development cost, which works out to be approximately RM366,200 per month.
The development of the hospital is expected to take 24 months to complete.
KPJ said the proposal is in line with the group’s objective to increase its network of hospitals, where private healthcare is in demand.
At 5 p.m. today, KPJ shares closed down 6 sen or 1.4% to RM4.21, for a market capitalisation of RM4.4 billion.