KUALA LUMPUR (July 8): Tiong Nam Logistics Solutions Sdn Bhd (TNLS), a 100%-owned subsidiary of Tiong Nam Logistics Holdings Bhd, is sub-leasing a 20-acre piece of vacant land in Johor for 30 years for RM33.15 million for a period of 30 years for future warehouse construction.

In a filing to Bursa Malaysia today, Tiong Nam said TNLS has inked a sub-lease agreement with LMT to effect the sub-lease.

LMT is a subsidiary of Johor Corp (JCorp), which owns the tract. LMT has been given a 60-year lease by JCorp to develop 50 acres of land at Tanjung Langsat Port into a warehousing and logistics hub.

Tiong Nam said the sub-lease rental was arrived on a “willing-buyer-willing-seller” basis after taking into consideration the development potential of the land as well as by reference to the current market value of the land in the surrounding area and the location and condition of the land.

The land is currently free from encumbrances and TNLS intends to construct workshop and warehouse on the land, it added.

As the payment of sub-lease rental is on cash basis, it said that the sub-lease of the land will not have any effect on the issued and paid-up capital, substantial shareholders’ shareholdings, net tangible assets and net assets per share of the company nor will it have any material effect on the earnings per share of the company for the financial year ending March 31, 2016.

The net book value and original cost of investment of the land is not made known to the company at the date of this announcement, it noted.

JCorp, being the registered proprietor of the land, had previously granted a 60-year lease of the designated land to the sub-lessor LMT, on Sept 6, 2013, it also said.

The principal activities of TNLS consist of the provision of logistics and warehousing services and property investment, it added.