KUALA LUMPUR (Dec 19): Kawan Food Bhd has cancelled its plan to buy five parcels of land measuring 7.08 acres in Shah Alam, Selangor for RM50.46 million, as the vendor who was in the midst of acquiring two of the plots from Perbadanan Kemajuan Negeri Selangor (PKNS) had failed to get PKNS' agreement to sell the plots.
Kawan Food inked a sale and purchase agreement (SPA) with RGP Warehouse Solutions Sdn Bhd to buy the five plots — three parcels totalling 4.07 acres for RM28.94 million (RGP lots), and the two plots under PKNS for RM21.52 million (PKNS lots) measuring 3.01 acres — in April this year, to build its second manufacturing plant.
The SPA was conditional upon: i) the vendor obtaining the state authority's consent to transfer the RGP lots to Kawan Food's wholly owned Kawan Food Manufacturing Sdn Bhd (KFMSB), who inked the deal; and ii) RGP signing an SPA with PKNS for the sale of the PKNS lots to RGP, so that RGP could transfer it to KFMSB.
"Despite reasonable efforts being made to fulfil these conditions precedent, only condition (i) was met but as at to-date, condition (ii) was not met. In view of the limited land size of the RGP lots without the PKNS lots, it is not cost-effective for KFMSB to purchase only the RGP lots.
"In view thereof, in order to bring closure to the SPA, KFMSB and RGP had mutually agreed in writing to terminate the SPA on Dec 16, 2022 and neither party shall have any further or other claim against the other for anything arising from the SPA," Kawan Food said in a Bursa Malaysia filing on Monday (Dec 19).
Kawan Food shares closed 1.4% or three sen lower at RM2.12 on Monday, giving it a market capitalisation of RM768.67 million. The stock has climbed 29.3% from when it was trading at RM1.64 at the start of the year.