KUALA LUMPUR (July 22): Iskandar Waterfront City Bhd (IWC) has firmed up an agreement to dispose of 5.58 acres of vacant land in Johor Bahru for RM53.24 million to Knusford Bhd.

The property is one of two parcels of freehold land that IWC proposed to divest to Knusford for between RM90 million and RM95 million under a Heads of Agreement signed on May 13.
 
On Friday (July 22), IWC's wholly-owned subsidiary Success Straits Sdn Bhd signed a deal to dispose of the 5.58-acre piece of land to Knusford's wholly-owned unit Knusford Resources Sdn Bhd, said IWC in a filing with Bursa Malaysia.

The group said RM50.76 million of the sale price will be offset by the same amount it owes Knusford and its subsidiaries, while the balance RM2.48 million will be settled by cash.
 
IWC said its original cost of investment for this property in March 2017 was RM52.89 million.

As for the second parcel of land measuring 4.27 acres freehold vacant land, IWC said it is still negotiating the terms and conditions of the sale.

IWC said the proposed disposal of the first piece of land represents an opportunity for it to unlock the value of the property at a fair price.

“The group views the proposed disposal and settlement as reasonable after taking into the consideration the marketability of the land and the difficulty of seeking alternate buyers for the property in view of the current challenging economic conditions,” it said.

The group said this disposal is also in line with its intention to focus its resources on existing ongoing projects, while being able to settle debts owing to Knusford without incurring cash outflow.

IWC’s executive vice chairman Tan Sri Lim Kang Hoo owns a 0.6% direct interest and 34.29% indirect shareholding in the group through his ownerships of Iskandar Waterfront Holdings Sdn Bhd and Credence Resources Sdn Bhd.

Lim also holds a 0.62% direct interest and 32.53% indirect stake in Knusford by virtue of his shareholdings in Aman Setegap Sdn Bhd and Kinston Park Sdn Bhd.

IWC shares gained half a sen or 1.7% to 29.5 sen at market close, giving it a market capitalisation of RM271.73 million.

Knusford, on the other hand, closed unchanged at 49.5 sen, valuing the group at RM49.32 million.