KUALA LUMPUR (Nov 7): IOI Properties Group Bhd’s (KL:IOIPG) chief executive officer Lee Yeow Seng, in his personal capacity, has withdrawn the resolution at the EGM to seek shareholders’ consent to allow him to continue helming the listed entity while holding an interest in Shenton 101 Pte Ltd.
The redevelopment of Shenton House in Singapore is expected to give rise to the conflict of interest position considering that Lee is the major shareholder and CEO of IOI Properties and he is also the owner of Shenton 101.
The resolution for the EGM was required due to a law that bans a director or officer from engaging in competitive business activities without shareholder consent.
Lee wrote in a letter that the decision to withdraw the resolution was made after taking into account feedback from various institutional shareholders. Lee is now considering the available options and plans to engage further with the institutional shareholders before the re-development begins in 2027.
“We are looking at different options,” Lee told The Edge at the sidelines after the shareholders meeting. There is still time “to think about it to come out with the plan before redevelopment works commence”, he said.
Lee’s family vehicle Vertical Capacity Sdn Bhd controls 65.67% in IOI Properties. The Employee Provident Fund is the second largest shareholder holding 7.74%, while AIA Bhd has 3.91% and Amanah Saham Nasional Bhd has 2.86%.
Nonetheless, Lee did not rule out the possibility of IOI Properties undertaking the redevelopment works of the commercial property “with the right timing and the right structure” in the future.
In August, IOI Properties’ minority shareholders rejected the offer to purchase Shenton House from Lee, citing an already significant exposure to the Singapore property market, as well as existing capital commitments following other recent acquisitions.
The plan was for Shenton 101 and IOI Properties to jointly develop the redevelopment project. Subsidiaries of IOI Properties had been appointed to be the sole project manager and property manager for the redevelopment of the commercial property.
Lee’s private vehicle Shenton 101 bought Shenton House in a tender for S$538 million (RM1.9 billion) a year ago. It was the sole bidder for the property spanning 3,377 square metres and designated for gross floor area of 11.2 times the total land area.
The property has a 44-year land lease, with the potential to be extended to a fresh 99-year lease.
Nevertheless, Lee said the outlook for IOI Properties in Singapore remains positive as the company completed the IOI Central Boulevard and plans to launch Marina View Residence by early next year.
The company is targeting full tenancy by next year for IOI Central Boulevard, a Grade-A office tower and the company’s largest wholly-owned development in Singapore, he said, adding that he is optimistic that Marina View Residence luxury condominiums will get a “good” take-up rate.
At the time of writing, shares of IOI Properties were unchanged at RM2.31, giving the group a market capitalisation of RM12.72 billion. Year to date, the counter is up 32%.
Note: The article has been amended for accuracy.