KUALA LUMPUR (May 22): YNH Property Bhd last Friday (May 19) received 26 questions from Bursa Securities in relation to its land sale in Sri Hartamas, here, to Sunway Bhd’s wholly owned subsidiary Sunway Living Space Sdn Bhd for RM170 million cash.
On May 12, YNH Property's wholly owned subsidiary Kar Sin Bhd had signed a sale and purchase agreement (SPA) with Sunway to dispose of a 5.09-acre parcel of land in Sri Hartamas.
In its reply to Bursa, YNH explained that the RM150 million purchase consideration and the salient terms are derived from direct negotiation between YNH and Sunway "based on the respective parties' intention to maximise their respective benefits and gains".
Under the deal, YNH will receive an additional RM50 million cash from Sunway should it manage to obtain a new development order (DO) from the authorities for a project with a minimum plot ratio of seven on its net land area (NLA) within one year from the date of the signing of the SPA. The land has an existing DO for a minimum plot ratio of five on the NLA.
To this, YNH further clarified that the disposal consideration could potentially increase by RM50 million to RM220 million should the company successfully obtain a new DO within one year from the date of the SPA. "The revised percentage ratio after taking into consideration the sum of RM50 million is 17.885%."
"The net proceeds arising from the disposal are expected to be utilised within 24 months for the working capital of YNH and its group of companies," it added.
On the rationale for entering into the SPA on May 20, 2008 between the registered proprietor and the first beneficial owner when both entities are owned by the same parties namely Lau Sheng Ming and Yu Teong Wei, YNH replied that it referred to the register owner's and the first beneficial owner's internal restructuring.
On the consideration sum paid by the government to acquire part of the land on May 5, 2009, YNH said: "We are unable to provide the sum paid by the government as the registered owner and first beneficial owner deemed that these are confidential information on their part and they are unwilling to disclosed the sum agreed."
Meanwhile, YNH said it did not make any announcement pertaining to the termination of a turnkey construction agreement in April 2022 because "these are ordinary business of the company and to be consistent with the non-announcement of the turnkey construction agreement when the agreement was first entered into".
The proposed acquisition is conditional on, among others, the approval of the shareholders of YNH Property, Kar Sin and Sunway Living Space, and is expected to be completed in the fourth quarter of 2023.
At 4.38pm, YNH shares were unchanged at RM4.59, with 68,700 shares done. Its market capitalisation stood at RM2.43 billion.