KUALA LUMPUR (Sept 11): YNH Property Bhd (KL:YNHPROP) has been given until Dec 31 to fulfil outstanding conditions for its RM170 million land sale to Sunway Bhd (KL:SUNWAY), failing which the purchaser will have the right to terminate the deal.
The latest deadline, extended from Sept 12, was agreed under a sixth supplemental agreement signed between YNH's wholly-owned subsidiary Kar Sin Bhd, Sunway's unit Sunway Living Space Sdn Bhd, registered proprietor Imbuhan Sempurna Sdn Bhd and first beneficial owner Great Wall Park Sdn Bhd (GWP), according to a Bursa Malaysia filing on Friday.
Under the agreement, Kar Sin is required to use its "best endeavours" to fulfil the outstanding conditions precedent by Dec 31, after which Sunway Living Space may exercise its rights and remedies under the sale and purchase agreement (SPA), including terminating the deal.
Any further extension beyond Dec 31 will have to be mutually agreed by the parties in writing.
YNH did not specify in its latest filing which conditions remain outstanding.
The proposed disposal, first announced in May 2023, involves a 5.098-acre freehold parcel in Desa Sri Hartamas, Kuala Lumpur, which Sunway plans to develop into an integrated mixed development comprising serviced apartments, retail spaces and wellness suites with an estimated gross development value of at least RM850 million.
The transaction has faced repeated delays since the SPA was signed on May 12, 2023, with the latest agreement marking the sixth supplemental agreement to vary its terms.
In May 2024, YNH disclosed that a land search had uncovered a registrar's caveat lodged over the property in September 2023, together with an endorsement indicating a partial acquisition of the land.
The parties subsequently agreed to extend the conditional period to allow Kar Sin, among other things, to obtain a new development order and have the caveat removed or cancelled, while YNH was to bear the related costs and provide documentary proof to Sunway's solicitors.
Kar Sin was also required to ensure the issuance of a new title document indicating that it had acquired the land before selling it to Sunway Living Space.
While Kar Sin is the vendor under the transaction, the property's registered proprietor is Imbuhan Sempurna, while GWP is its first beneficial owner. Both Imbuhan Sempurna and GWP are owned by Yu Teong Wei and Lau Sheng Ming.
YNH had previously disclosed that Kar Sin entered into an SPA with GWP in April 2022 to acquire the land, after the two parties agreed to terminate a 2016 turnkey construction agreement for a mixed residential and commercial development on the site.
Of the RM239.5 million security deposit Kar Sin had paid under the turnkey agreement, RM150 million was subsequently treated as payment for the land acquisition, while GWP was to refund the remaining RM89.5 million to Kar Sin.
In June, the parties extended the conditional period by another three months from June 12 to Sept 12 and revised the mechanism governing potential additional consideration for the land.
The agreement also allowed Kar Sin to continue applying for a new development order with a plot ratio above five for up to one year after the transaction became unconditional.
YNH shares ended unchanged at 34 sen on Friday, with a market capitalisation of RM179.9 million.