KUALA LUMPUR (Nov 27): Debt-ridden Perak Corp Bhd has appointed Advancecon Holdings Bhd's wholly-owned subsidiary Advancecon Development Sdn Bhd as a joint venture (JV) partner to jointly develop the main infrastructure for the Silver Valley Technology Park Industrial Hub, and carry out sale of completed industrial lots with main infrastructure on 39 pieces of leasehold land in Hulu Kinta, Perak, which has an estimated total gross development value (GDV) of RM1.03 billion.

In a filing with Bursa Malaysia on Monday, Perak Corp said it has issued a letter of award to Advancecon for the proposed joint development measuring 798.24 acres. The project is subject to the execution of a joint development agreement in due course.

The proposed joint development will be for five years, subject to the approval of the relevant authorities, shareholders of Perak Corp at an extraordinary general meeting to be convened and Bursa Malaysia Securities on Perak Corp’s regularisation plan.

It is also subject to the written undertaking from Perbadanan Kemajuan Negeri Perak, who is owner of the land and the holding corporation of Perak Corp.

Under the JV, Perak Corp will be entitled to a revenue share of 35% based on the net development value while Advancecon will be entitled to 65%.

"As Perak Corp is classified as an affected listed issuer under Practice Note 17 (PN17), the proposed joint development provides an avenue for the company to raise funds to channel towards the group’s business operations which will improve the group’s overall cash flow position, as well as strengthening its financial position as part of its regularisation effort," said Perak Corp. It slipped into PN17 status in February 2020 as a result of a default in payment and its inability to declare solvency.

"The proposed joint development is part of the measure to raise the necessary cash required for the group’s business regularisation plans, which are still in the midst of being finalised as at the date of this announcement. The group plans to make the requisite announcement for its proposed regularisation plan in the fourth quarter of 2023," Perak Corp added.

In view that the proposed joint development is a component of Perak Corp’s regularisation plan, shareholders’ approval for the proposed joint development will be sought together with the regularisation plan concurrently.

The proposed joint development is expected to contribute positively to the earnings per share and net assets per shares of Perak Corp for the financial year ending Dec 31, 2024 (FY2024) onwards until the expiry of the project.

Advancecon intends to fund the proposed joint development via internal funds and/ or external borrowings.

Perak Corp shares ended the day up one sen or 2.44% at 42 sen on Monday, valuing it at RM42 million. Advancecon shares closed unchanged at 29 sen, with 132,000 shares traded. Its market capitalisation stood at RM169.57 million.