Tokyu Land joins Titijaya’s Riveria City

◦ Japanese firm comes on board RM1.5b project in KL as strategic partner via equity injection of RM40m and financing of RM40m

PETALING JAYA: Titijaya Land Bhd revealed that Japan’s Tokyu Land Corp will come aboard as a strategic partner in its RM1.5 billion Riveria City mixed development project by its subsidiary, Riveria City Sdn Bhd (RCSB) for a total consideration of RM80 million.

According to the group’s Bursa disclosure, Tokyu Land’s subsidiary Tokyu Land Asia Pte Ltd (TLA), will acquire a 30% equity interest in RCSB of RM40 million and provide business financing amounting to RM40 million.

Tokyu Land is a comprehensive real estate company incorporated in Japan, and a core subsidiary of the Tokyu Fudosan Holdings Group, a listed company in the Tokyo Stock Exhange. Tokyu Fudosan is also one of the companies in the Nikkei 225 Index.

Titijaya Land explained that, in addition to the RM40 million initial equity injection, Titijaya Land and TLA will make available funding by way of shares subscription into RCSB to the limit agreed upon by both parties.

Commenting on the collaboration, deputy group managing director Lim Poh Yit said the joint participation of Titijaya Land and TLA in RCSB will provide the group with an opportunity for growth expansion as well as the access to new markets and distribution networks.

Currently, Tokyu Fudosan Holdings Group has presence in Shanghai, Singapore, New York, Los Angeles and Jakarta, he said.

“With the TLA collaboration, Titijaya Land will be able work with TLA’s associates to leverage their vast project expertise in the Riveria City project. This will in turn enhance the attractiveness and marketability of Titijaya Land and its property projects,” Lim added.

Under the Titijaya Land-TLA collaboration, an office suite tower and two towers of serviced apartments on top of a car park/lobby/shop podium will be developed across a 3.05-acre leasehold site in Brickfields.

Riveria City is currently under construction, comprising 784 office suites, 1,398 serviced apartments, 24 shop lots and 2,246 vehicle parking lots, with the total built-up area of about 2.92 million sq ft.

Meanwhile, Titijaya Land has also entered into a shareholders’ agree-ment with TLA and RCSB to regulate the affairs of RCSB and the respective rights of Titijaya Land and TLA as shareholders of RCSB, and jointly participate in the development, construction, promotion and marketing of Riveria City to the Malaysian and foreign markets.

“Aside from that, RCSB had also entered into a share subscription agreement with TLA to issue and allot 600,000 ordinary shares and 39.4 million Class A Shares in RCSB to TLA for the sum of RM600,000 and RM39.4 million respectively,” it said in a press statement.

Titijaya Land will also subscribe for one million ordinary shares and 91.93 million redeemable preference shares for the sum of RM1 million and RM91.93 million, respectively, in RCSB.

Furthermore, on Dec 13, RCSB also entered into a facility agreement with TLA’s wholly owned subsidiary, TLMY Sdn Bhd, for business funding of RM40 million for the development of Riveria City.

“Following the facility agreement, financial assistance which does not exceed 5% of the net tangible assets of the Titijaya Land Bhd Group is provided to RCSB, whereby a corporate guarantee is provided to TLMY Sdn Bhd, as due performance, in accordance with the facility agreement,” said the group.

Barring any unforeseen circumstances, Titijaya expects the exercise to be completed by the second quarter of the financial year ending June 30, 2021.