KUALA LUMPUR (Oct 3): Atlan Holdings Bhd (KL:ATLAN) said its indirectly owned units, Cergasjaya Sdn Bhd and Cergasjaya Properties Sdn Bhd (CPPA), have received notices for the compulsory acquisition of their lands in Bukit Kayu Hitam, Kedah, for a road construction project.

Atlan holds Cergasjaya and CPPA through its 75.53%-owned subsidiary, Duty Free International Ltd (DFI), which is listed on the Singapore Exchange.

In a filing with the Singapore bourse's regulator on Thursday, DFI said the land was acquired by Malaysia's Home Affairs Ministry and is administered by the Department of Director General of Lands and Mines, Kedah.

"The compulsory land acquisition is required for a road construction project to connect the Bukit Kayu Hitam Immigration, Customs, Quarantine, and Security (ICQS) Complex to the CIQ Sadao facility in Thailand," the company said.

Cergasjaya owns the Duty-Free Complex in Bukit Kayu Hitam, while CPPA holds the lease for three plots of land from Kedah State Development Corporation (PKNK).

DFI added that the compulsory land acquisition will lead to the closure of Cergasjaya's duty-free business. As of the end of February, Cergasjaya contributed approximately 24% to the company’s revenue.

The land enquiry process for determining compensation is still ongoing and DFI is working with legal advisors to ensure fair compensation. The financial impact will be announced once the process is complete, the company said.

Shares in Atlan closed unchanged at RM2.63 on Thursday, giving the group a market capitalisation of RM667.1 million, while DFI shares last traded at 7.1 Singapore cents.