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11 Dec 2009 09:00
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Date: 11Β DecemberΒ 2009
On behalf of: Aseana Properties LimitedΒ ("Aseana" orΒ "the Company")
Embargoed for: 0900hrs
Aseana Properties Limited
Signing ofΒ MoU to acquire 70% stakeΒ of prime city-centre land inΒ KualaΒ LumpurΒ
To develop an upscale residential developmentΒ
Aseana Properties LimitedΒ (LSE: ASPL),Β aΒ leadingΒ property developer investing in Malaysia and VietnamΒ listedΒ on theΒ OfficialΒ List of the London Stock Exchange, today announces that it has entered intoΒ a non-binding Memorandum of UnderstandingΒ ("MoU")Β in relation toΒ the co-development ofΒ aΒ prime developmentΒ siteΒ (the "Site")Β located in theΒ heart ofΒ Kuala Lumpur City Centre ("KLCC")Β
The Site is strategically located on Jalan Kia Peng,Β where prestigious landmarks such as Grand Hyatt Hotel (under construction), KLCC Convention Centre, Suria KLCCΒ shopping centre, KLCC parkΒ and the world famousΒ PetronasΒ TwinΒ TowersΒ sit. With a land area of approximately 43,559 square feet,Β AseanaΒ andΒ its investment manager, Ireka Development ManagementΒ Sdn. Bhd.Β ("Ireka"),Β envisage an upscale residential development on theΒ SiteΒ that would appeal to the lifestyle of urban Malaysians and foreign expatriates.
The owners of the SiteΒ have stipulated a commercial conditionΒ of onlyΒ sellingΒ the SiteΒ to a local Malaysian company and offered the SiteΒ to IrekaΒ Corporation BerhadΒ ("ICB"),Β theΒ parent company of IrekaΒ and aΒ major shareholderΒ inΒ Aseana.Β ICBΒ is listed onΒ BursaΒ Malaysia.Β ICBΒ expressed its interest in purchasing theΒ SiteΒ and informedΒ AseanaΒ of this intention. AsΒ AseanaΒ is unable to purchase theΒ SiteΒ directly,Β ICBΒ subsequently invitedΒ AseanaΒ toΒ co-invest andΒ co-develop the Site upon successful acquisition of the Site byΒ ICB.Β
ICB, proposes to acquire the Site through a 100% owned subsidiary, World Trade Frontier Sdn. Bhd. ("SPVCo")Β and the MoU contemplatesΒ AseanaΒ taking upΒ a 70% stake in the SPVCo for an amount that would value the SPVCo at Ringgit Malaysia 87,120,000, plus incidental costs arising from the transaction. ICBΒ will continue to hold a 30% stake in the SPVCo.Β
ICBΒ has todayΒ separatelyΒ entered into a Sales & Purchase AgreementΒ ("ICBΒ SPA")Β with the owners of theΒ SiteΒ to purchase theΒ SiteΒ for a cash consideration of Ringgit Malaysia 87,120,000 (approximately US$25.3Β million).
It is envisaged thatΒ AseanaΒ will enter into definitive agreements withΒ ICBΒ before 24 December 2009. The completion of this proposed transaction will be conditional upon (a) completion of theΒ ICBΒ SPA, (b) the Directors of Aseana being satisfied that the transaction has been carried out in a fair and reasonable manner, supported by opinions from an independent valuation and an independent assessment, and (c) the approval from the shareholders ofΒ ICBΒ forΒ sellingΒ theΒ 70% stake in SPVCoΒ to Aseana. Β
Commenting on theΒ signing of the MoU, Dato' Mohammed Azlan bin Hashim, Chairman of Aseana Properties Limited, said:
"KLCC is a proven and sought-after location forΒ high-end residences inΒ MalaysiaΒ and we are excited with thisΒ opportunity of being able toΒ expand our portfolio of projects in this prime area. With the Malaysian and global economiesΒ showing signs ofΒ improvementΒ and recentΒ renewedΒ interest inΒ KLCC properties,Β weΒ believe that the proposed development on theΒ SiteΒ will be well received when it is launched.
"We are also excited with the prospect of partnering ICBΒ on this development. With over 42 years of experience and track record of investing and developing inΒ Malaysia, we believe thatΒ ICBΒ will be aΒ valuableΒ joint venture partner that will contribute to the success of the project."
Ends
Enquiries:
|
Aseana Properties Ltd |
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|
Tan May Lee |
Tel: +603 6203 6688 |
|
Email:Β Β maylee.tan@ireka.com.my |
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|
Redleaf Communications |
Tel:Β 020Β 7566Β 6700 |
|
Samantha Robbins / Adam Leviton / Kathryn Hurford |
Email:Β aseana@redleafpr.com |
|
Fairfax I.S. PLC |
Tel: 020 7598 5368 |
|
James KingΒ / Gillian McCarthy |
Notes to Editors
Aseana Properties LimitedΒ typically investsΒ in development projects at pre-construction stage, with a primary focus on locationsΒ within the major cities ofΒ MalaysiaΒ andΒ Vietnam.
InvestmentΒ is made in projects where itΒ is believed there will be a minimum 30% annualised return on equity ("ROE") on investments in Vietnam and a minimum 20% ROE on investments in Malaysia.
No one underlying single asset will account for more than 30% of the gross assets of the Company at the time of investment.
The Directors believe the following factors should provide sustainable growth in the real estate sectors of bothΒ MalaysiaΒ andΒ Vietnam:
An increasing standard of living and urbanisation driven by a burgeoning young and middle class population
Clear Government role in encouraging participation of private sectors in real estate development, as well as encouraging and promoting land and property ownership
Improving availability of mortgages to encourage property ownership
Favoured Foreign Direct Investment (FDI) destinations driving demand for commercial and industrial properties
Ireka Development Management, theΒ DevelopmentΒ ManagerΒ for Aseana Properties Limited, is a wholly-owned subsidiary of Ireka Corporation Berhad, a company listed onΒ the Bursa Malaysia since 1993, which hasΒ overΒ 40 years of experience in construction and property development.
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