KUALA LUMPUR (March 22): MMC Corp Bhd is acquiring Tradewinds Corp Bhd's 50% stake in developer Retro Highland Sdn Bhd for RM250 million cash, in a related-party transaction.

The acquisition price is inclusive of RM55 million in shareholder's loans advanced by Tradewinds to Retro Highland, including interest, MMC said in a bourse filing, noting that the deal does not require shareholders' approval.

Retro Highland is a 50:50 joint venture between Tradewinds and S P Setia Bhd. Tradewinds is controlled by tycoon Tan Sri Syed Mokhtar Albukhary, who also owns a controlling stake in MMC.

MMC said Deloitte Corporate Advisory Services Sdn Bhd has valued Retro Highland at between RM356 million and RM410 million.

Excluding the shareholder's loan from the valuation, the value of the 50% stake in Retro Highland ranges between RM178 million and RM205 million, it added.

Retro Highland has been appointed by Kuala Lumpur City Hall (DBKL) to redevelop four of the council's housing projects in Cheras under the Quality Sustainable People Housing (QSPH) development. The company signed a master agreement with DBKL in March 2019.

"In consideration, Retro Highland will be awarded with approximately 77.80 acres of leasehold land located in Cheras, Kuala Lumpur, which Retro Highland is entitled to develop a mixed-use development of residential and commercial components thereon," said MMC.

The group said the QSPH project will be carried out via land swap and compulsory land acquisition methods — the latter involving units belonging to DBKL and individuals who own units in Sri Melaka and Sri Pulau Pinang flats under the project.

It added that its wholly-owned unit MMC Engineering Sdn Bhd is expected to tender for portions of construction works related with QSPH, which has an estimated gross development value of RM16 billion over a period of 24 years.

"With this, the QSPH project offers opportunities for MMC Engineering to potentially participate and secure sustainable construction earnings throughout the long-term project period," it added.

The deal came on the heels of another sizeable acquisition involving MMC.

The group's indirect unit Northport (M) Bhd as well as Westports Holdings Bhd have teamed up to jointly acquire loss-making Boustead Cruise Centre Sdn Bhd (BCC) from Boustead Holdings Bhd for RM230 million.

BCC is also the registered owner of nine land parcels with buildings and a jetty measuring 69.8 acres on Pulau Indah.

Shares of MMC fell nine sen or 7.89% to close at RM1.05 today, valuing the group at RM3.2 billion. Year-to-date, the counter has risen by 16.67%.