KSL proposes bonus issue, reinvestment plan

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KUALA LUMPUR: Johor-based property developer KSL Holdings Bhd has proposed a one-for-one bonus issue of up to 487.1 million shares, on the basis of one bonus share for every one existing KSL share held.

The bonus issue will increase the group’s share capital to RM487.1 million comprising 974.3 million shares of 50 sen at par each, from RM194.3 million comprising 388.7 million shares of 50 sen par each as at Tuesday.

KSL has also proposed to implement a dividend reinvestment plan (DRP) to enhance trading liquidity and capital management.

“We have put in place our strategies to grow the gross development value (GDV) of our developments and property investments in the coming years. In light of this, the KSL group is certainly set for a high growth trajectory going forward,” said Ku Hwa Seng, chairman of KSL Holdings Bhd, in a statement.

“These corporate exercises are therefore reflective of the group’s scale of operations. The bonus issue allows for greater shareholder participation through improved trading liquidity, while the DRP is targeted not only at implementing effective capital management but also allowing shareholders to further participate in our growth story,” he said.

At present, KSL’s property development segment has a total GDV of RM40 billion, which is expected to sustain the group for up to 17 years. KSL also intends to expand its property investment segment in order to establish a strong recurring income stream.

Property development currently makes up 80% of the group’s revenue, with property investment contributing the balance of 20%.

Among its completed notable projects are Nusa Bestari — a mature township in Nusajaya, Iskandar Malaysia; KSL City — a RM5 billion GDV integrated development in the heart of Johor Baru comprising premier lifestyle retail destination KSL Mall, and KSL Hotel and Resort; and the luxurious high-rise condominiums of D’Esplanade Residences.

KSL shares closed down 15 sen or 3.28 % to RM4.43 yesterday, giving it a market capitalisation of RM1.72 billion.

This article first appeared in The Edge Financial Daily, on October 3, 2014.