Nirvana uplifts Singha Estate
Recent buy will supply lion’s share of revenue
SET-listed developer Singha Estate Plc (S), the property arm of the Bhirombhakdi family’s Boon Rawd Brewery Co, expects revenue of 4 billion baht this year.
Half will come f rom its recently acquired stake in property firm Nirvana Development.
Singha chief executive Naris Cheyklin yesterday said revenue from mergers and acquisitions would account for 70% of the target each year from 2015-19, over which time the company will invest 100 billion baht to develop projects and acquire assets.
“There will be many more assets we will buy this year including three hotels in the provinces with a combined investment of 6 billion baht and a few shopping malls we will spend at least 10 billion baht to acquire,” he said.
Singha Estate last Friday signed a share purchase and share subscription agreement with Nirvana through a share swap.
Singha Estate will issue 186,509,792 new shares for Nirvana in exchange for Nirvana’s existing 3,649,993 shares.
As a result, Singha Estate will hold 51% of Nirvana’s shares, while Nirvana will hold 3.8% of Singha Estate’s shares.
The share swap will be approved at Singha Estate’s annual shareholder meeting on April 22 and completed by June.
Nirvana chief executive Sornsak Somwattana said Singha Estate would help Nirvana to double its usual annual growth of 20%.
This year Nirvana plans to launch five new projects worth a combined 11 billion baht including three condo projects in Klong San district, in the Kaset-Nawamin area and in Pattaya.
The Klong San site, a five-rai riverfront plot, will feature a 49-storey building worth 5 billion baht with up to 200 units priced at more than 300,000 baht a square metre.
Also planned are two single-house developments in the Kaset-Nawamin area and on Rama II Road worth more than 3 billion baht combined.
Mr Naris said Singha Estate would launch two new projects this year worth 4 billion baht each. These will be a highend condo project on Asok Montri Road and a super-luxury single-house development on Pradit Manutham Road with units priced at 100 million baht.
During the first nine months of last year, Nirvana posted 1.1 billion baht in revenue for a net profit of 179 million. The company expects full-year net earnings of 200 million baht in 2014 and 250 million baht in 2015.
Singha Estate posted a net loss of 107 million baht on revenue of 203 million baht in the first nine months of last year.
The plan is to increase Nirvana’s registered capital to 1.4 billion baht, Mr Naris said.
Founded in 2005 with registered capital of 716 million baht, Nirvana has developed 19 residential projects in the mid-market and upper-end segments. It has 10 projects with remaining units for sale worth a combined 3 billion baht.
S shares closed yesterday on the SET at 9.30 baht, down 30 satang, in trade worth 47.6 million baht.