KUALA LUMPUR (Jan 29): Hap Seng Consolidated Bhd is planning an integrated mixed development within the KL Metropolis development near Jalan Tuanku Abdul Halim.
In a filing with Bursa Malaysia today, Hap Seng Consolidated said the land it plans to develop, which is owned by TTDI KL Metropolis Sdn Bhd, is a leasehold land located along Jalan Dutamas 2, measuring 8.95 acres.
To enable the group to undertake the development, Hap Seng Consolidated has via its unit Hap Seng Land Development Sdn Bhd entered into a shareholders' agreement (SHA) with TTDI KL and Golden Suncity Sdn Bhd (GSSB) to regulate their relationship inter se as shareholders of GSSB, pursuant to the terms and subject to the conditions as set out in the SHA.
Simultaneously, the three parties also entered into a development rights agreement (DRA), of which TTDI KL will grant GSSB the exclusive rights to develop a leasehold land measuring 8.95 acres, which formed part of the KL Metropolis development.
According to Hap Seng Consolidated, it would have to pay RM467.83 million to TTDI KL, pursuant to the terms and subject to the conditions as set out in the DRA. The consideration will be funded by external financing or shareholders' loans.
GSSB, currently a dormant company, is a subsidiary of Hap Seng Land Development, which is in turn a subsidiary of Hap Seng Consolidated.
The land, according to the diversified group, is part of the KL Metropolis development, a commercial master plan development spanning a 75.5-acre land that is envisioned to be the "International Trade and Exhibition City".
"The land is accessible via Jalan Kuching and Jalan Tuanku Abdul Halim connecting to the KL City Centre and KL Sentral.
"It is fronting the soon-to-complete Malaysia International Trade and Exhibition Centre (MITEC)," Hap Seng Consolidated said.
In addition, Hap Seng Consolidated said the land is surrounded by prime established residential and commercial areas such as Mont Kiara, Publika, Damansara Heights and Bangsar.
"Based on the foregoing, the group is confident with the positive prospects of the land to be developed into an integrated mixed development comprising components such as retail, office tower, serviced apartments and hotel, within a period of ten years," Hap Seng Consolidated added.
On rationale, Hap Seng Consolidated said the proposals are in line with its strategy to establish itself as a prominent player in the property development sector, particularly in the prime locations of the Klang Valley.
"In view of the development potential of the land, the proposals will contribute positively to the group's revenue and profitability when the proposed development comes on stream," it added.
The group noted its gearing would have increased to 0.78 times from 0.66 times as at FY14.
Barring any unforeseen circumstances and subject to the approval of the relevant authorities and fulfilment of all conditions precedent, Hap Seng Consolidated expects to complete the proposed development within 10 years from the unconditional date.
Hap Seng shares gained 40 sen or 5.88% to close at its five-year high of RM7.20, for a market capitalisation of RM15.53 billion.
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