KUALA LUMPUR (April 10): Nestcon Bhd (KL:NESTCON) has proposed acquiring three land parcels in Johor Bahru for RM95 million as part of a strategic diversification into property development, marking a shift beyond its core construction and renewable energy businesses.
The acquisition will be undertaken by Nestcon Iskandar Puteri Sdn Bhd, a 70%-owned subsidiary, and involves three plots of freehold land in Mukim Pulai with a combined size of 8.348 acres, according to a filing with Bursa Malaysia. The implied price works out to RM261.26 per sq ft.
The vendor of the said land parcels is KLG Iskandar Puteri Sdn Bhd, whose shareholders are Chong Ngun Kin and Lee Siang Huat.
Nestcon plans to transform the site into a mixed commercial and residential development comprising serviced apartments and retail units across two phases. The project is expected to carry a gross development value of RM1.37 billion against a gross development cost of RM1.03 billion, generating an estimated gross development profit of RM336.97 million.
Funding will be through a mix of internally generated funds and bank borrowings, with the final structure to be determined later.
Nestcon plans to expand into property development as a new core business alongside its building and infrastructure and renewable energy segments.
Currently, its building and infrastructure division remains the main driver, contributing about 98% of its RM11.5 million net profit on RM723.8 million revenue for the financial year ended Dec 31, 2025.
The group said the diversification could contribute at least 25% of its future net profits or net assets, subject to shareholder approval at an extraordinary general meeting.
The acquisition is targeted for completion in the second half of 2026.
Nestcon’s board said the proposals are aimed at reducing reliance on its existing businesses while enhancing long-term growth prospects.
By Friday’s midday break, shares in Nestcon were unchanged at 34 sen, valuing the group at RM264.87 million. Over the past one year, the stock has declined 11.7%.