KUALA LUMPUR (Nov 25): Radium Development Bhd (KL:RADIUM) said it is acquiring 13 acres of  leasehold land in Cheras — which will be used for mixed development — for RM458 million.

The company is acquiring the land from Dupion Development Sdn Bhd in a related-party deal, according to its bourse filing on Monday.

Dupion Development is owned equally by Jakel Development Sdn Bhd and Platinum Victory (WM) Sdn Bhd, a firm controlled by Tan Sri Gan Yu Chai, who is the brother of Radium managing director Datuk Gary Gan Kah Siong.

Yu Chai is also the managing director of Southern Score Builders Bhd (KL:SSB8).

Radium said 70% or RM320.6 million of the purchase price will be financed using bank borrowings and the remaining 30% or RM137.4 million using internally generated funds.

It added that its gearing level is expected to increase to 0.46 times from 0.05 times, as its total borrowings will rise to RM361 million from RM40.46 million.

Radium said the land acquisition will increase its total landbank in Kuala Lumpur to 34 acres from 20.77 acres at present.

Radium said the land is located within a transit-oriented development zone near the MRT Taman Pertama station, and offers the opportunity to capitalise on the growing demand for integrated and well-connected urban development projects.

The land, it added, will be used to develop serviced apartments and commercial spaces with a projected gross development value of RM2.54 billion.

The land acquisition is expected to be completed by the first half of 2025.

Commenting on the strategic purchase, Kah Siong said: “This proposed acquisition is a cornerstone of our growth strategy, positioning Radium to capture the increasing demand for integrated urban living spaces in Klang Valley. The project’s location and scale offer significant potential for capital appreciation, aligning perfectly with our focus on creating long-term value.”

Radium said the related-party transaction, which is subject to shareholders’ approval, is expected to contribute positively to the company's performance in the medium to long term.

 “It leverages Radium’s proven track record in developing successful urban projects, including the ongoing Suite Canselor, Residensi Desa Timur and Residensi Radium Arena developments,” it added.

Shares of Radium closed down 0.5 sen or 1% to 47.5 sen on Monday, giving the company a market capitalisation of RM1.65 billion. Year-to-date, the stock has risen 20.25%.