KUALA LUMPUR (July 7): Rhong Khen International Bhd (KL:RKI) is acquiring three industrial properties in Kapar, Selangor, for a cash consideration of RM47 million.

The land acquisition is to consolidate the furniture manufacturer's upstream and downstream operations, given that these properties are located about 1.5km from the company’s existing factories and head office, said Rhong Khen in a bourse filing on Tuesday.

The company said the proximity of the properties to its existing facilities would generate operational synergies, streamline logistics and improve coordination across its business.

Rhong Khen said its wholly-owned subsidiaries, Uptown Promenade Sdn Bhd and Latitude Tree Furniture Sdn Bhd, had entered into three sale and purchase agreements with Hsin Foong Manufacturer Sdn Bhd and Kelana Sempurna Sdn Bhd to acquire the properties.

The acquisition comprises factory properties and a two-storey office on a combined land size of 3.9963 hectares.

Hsin Foong Manufacturer is a wooden furniture parts manufacturer and exporter, while Kelana Sempurna’s principal activity is property investment.

The RM47 million purchase will be funded through a combination of internally generated funds and bank borrowings, said Rhong Khen.

Rhong Khen shares closed unchanged at RM1.07 on Tuesday, giving the company a market capitalisation of RM211 million.