Boustead to buy LTAT land for RM143.5mil
PETALING JAYA: Boustead Holdings Bhd’s subsidiary, Mutiara Rini Sdn Bhd, will acquire a prime land worth RM143.5mil in Kuala Lumpur from Lembaga Tabung Angkatan Tentera (LTAT).
In a filing with Bursa Malaysia, the company said the proposed acquisition is aimed at expanding Boustead’s land bank and investing in strategic property projects in the capital.
According to Boustead, the 6.59-acre land in Jalan Cochrane will be acquired at a discount of 0.35% or RM500,000 to its market value. The purchase is expected to be fully funded by the proceeds from the group’s rights issue exercise, which was completed in June 2016.
In a separate statement, Boustead deputy chairman and group managing director Tan Sri Lodin Wok Kamaruddin said the land purchase would benefit the group’s property division, moving forward.
“Given its strategic location in the heart of the city, not to mention its close proximity to public transportation as well as key shopping areas, the Jalan Cochrane land represents significant potential and value in terms of a residential development.”
He said Boustead’s strong track record in the property development sector would enable it to leverage on this potential.
“Indeed, the group’s property division has successfully completed existing projects within the same vicinity, including the MyTOWN Shopping Centre and the soon-tobe-launched One Cochrane Residences.
“We are confident that the acquisition of this land will enable us to further accelerate our growth strategy for the division in the long run,” he said.
The freehold land has been earmarked for a high-rise residential project, with an expected gross development value of RM1.15bil. The project is expected to be launched in 2019 and completed within the next three years.
Boustead is likely to fund the development through a combination of bank borrowings and internally generated funds.
The land acquisition, which is conditional upon the approval of the relevant state authority, will not have any material effect on Boustead’s earnings for the financial year ending Dec 31, 2017.
However, upon completion of the proposed development, the potential profit contribution is expected to enhance Boustead’s future earnings.
The acquisition of this land will enable us to further accelerate our growth strategy for the division. Tan Sri Lodin Wok Kamaruddin