KUALA LUMPUR (June 28): Toner manufacturer Jadi Imaging Holdings Bhd is selling freehold land with a detached factory-cum-three-storey office in Shah Alam for RM23 million.

In a filing with Bursa Malaysia today, it said its wholly-owned subsidiary Jadi Imaging Technologies Sdn Bhd entered into a sale and purchase agreement (SPA) with Tropical Fairyland Sdn Bhd.

“The proposed sale and leaseback entails the disposal of the said property for the sale consideration to be satisfied entirely in cash,” said Jadi Imaging.

The gross proceeds from the proposed disposal will be used for bank borrowings repayment, working capital, estimated real property gain tax payable pursuant to the proposed disposal and defray estimated expenses relating to the proposed disposal, said Jadi Imaging.

“The proposed disposal will enable Jadi Group to generate immediate cash flow and repay part of the group’s bank borrowings, which will reduce the gearing level of the group,” said Jadi Imaging.

“This will also result in interest savings and provide financial flexibility to the group to secure additional borrowings should new investment opportunities arise,” the company added.

Barring any unforeseen circumstances, the proposed disposal is expected to be completed by the fourth quarter of 2017, said Jadi Imaging.

Shares in Jadi Imaging closed unchanged at 6.5 sen for a market capitalisation of RM61.22 million.