KUALA LUMPUR, Aug 14 — Sunway Bhd’s wholly owned unit Sunway City Sdn Bhd (SunCity) today inked a share transactions agreement with Iskandar Assets Sdn Bhd (IASB) and Sunway Iskandar Development Sdn Bhd (SIDSB).
In a filing with Bursa Malaysia, it said pursuant to the agreement, SunCity will acquire 770,450 ordinary shares held by IASB in SIDSB, representing 40 per cent of the share capital of SIDSB, for a total purchase consideration of RM770,450.
SunCity will also subscribe for 84.2 million non-convertible non-cumulative redeemable preference shares (NCRPS) in SIDSB for a total consideration of RM84.2 million.
Thereafter, SIDSB will redeem 76.3 million NCRPS held by IASB in the share capital of SIDSB at a redemption price of RM84.2 million out of the proceeds of the fresh issuance of NCRPS to SunCity.
It said consequent to the completion of the proposed acquisition and redemption of NCRPS, SIDSB will become a wholly owned subsidiary of SunCity.
Sunway said the proposed acquisition and subscription bode well with the development strategy of both SunCity and IASB.
“From Sunway’s perspective, SunCity will take on a full 100 per cent stake in SIDSB as Sunway is confident with the prospect of developing Sunway City Iskandar Puteri into Sunway’s next flagship township.
“The proposed development under Sunway City Iskandar Puteri township will consist of two major precincts, Riverside and Capital, with a low plot ratio of 1:1.
“With a sizeable total landbank of 445 hectares wholly owned by Sunway, the process of emulating the two successful townships in Sunway City Kuala Lumpur and Sunway City Ipoh can be carried out with the tremendous opportunity to realise and unlock the value of SIDSB’s landbank and thus, increase the future earnings of SIDSB,” it said.
On risks of the proposed transactions, Sunway said the proposed acquisition and subscription would entail higher financial requirements to fund the future development of Sunway City Iskandar Puteri.
“However, Sunway will take the necessary steps to mitigate the risks identified by obtaining external debt financing as the development progresses.
“No assurance can be given that significant changes in any of these factors will not materially affect Sunway’s operations and financial performance,” it added.
Barring any unforeseen circumstances, the proposed transactions are expected to be completed by the third quarter of 2023.
— Bernama
