KUALA LUMPUR (Feb 6): Gadang Holdings Bhd is acquiring two parcels of freehold land totalling 78 acres in Pontian, Johor from GP Views Development Sdn Bhd — a private company owned by Tropicana Corp Bhd founder Tan Sri Danny Tan Chee Sing and his family — for RM149 million cash.

Gadang said the proposed acquisition is in line with its strategy to expand the revenue and earnings contribution from its property development segment.

"The proposed acquisition will help to replenish the group’s land bank for landed residential properties and to further increase its presence in the property market in Johor," it added in a filing with Bursa Malaysia today.

Gadang's indirect wholly-owned subsidiary Splendid Pavilion Sdn Bhd today entered into a conditional sale and purchase agreement with GP Views for the proposed acquisition.

It added that the land comes with a master development layout approval, which will be procured by GP Views for residential development with the density of 12 units per acre.

Gadang will fund the proposed deal via a combination of internal funds and/or bank borrowings.

"The board is of the view that the proposed acquisition is expected to contribute positively to the earnings and earnings per share of Gadang Group in the future financial years if and when the said land is successfully developed," it added.

Barring any unforeseen circumstances, the proposed acquisition is expected to be completed by the second quarter of 2019.

Gadang shares closed unchanged at RM1.11 today, bringing a market capitalisation of RM732.51 million.