KUALA LUMPUR (July 18): O&C Resources Bhd (OCR) has bagged a RM324 million turnkey contract to build houses under the 1Malaysia Civil Servants Housing Project (PPA1M) in Precinct 5, Putrajaya.

In a filing with Bursa Malaysia today, OCR said it has received a letter of award from Damansara Realty (Johor) Sdn Bhd (DRJ) to undertake the project on an 11.9-acre site.

On Oct 14, 2016, DRJ had entered into a development agreement with Putrajaya Corp, giving DRJ the right to develop the PPA1M housing project, as well as a commercial portion which does not fall under PPA1M.

OCR said it also signed a commercial and collaboration agreement with DRJ for the commercial portion.

However, the estimated value of this portion was not revealed except that OCR will be entitled to 80% of the profit and DRJ the remaining 20%.

DRJ will also have a minimum profit of RM10 million earned from the commercial portion, with OCR to pay for the difference in the event that the cumulative profit for DRJ is below RM10 million.

OCR said it will source its own financing for the project, which will take four years to complete.

It added that the project is not expected to contribute to its earnings and net assets for the financial year ending July 31, 2017.

OCR shares closed up 1.5 sen or 2.65% at 58 sen today, giving it a market capitalisation of RM141.39 million. — theedgemarkets.com

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