KUALA LUMPUR (July 11): Versatile Creative Bhd said the due diligence for the development of medium-cost apartments, with a gross development value of RM110 million, in Johor Bahru has been delayed.

“The board of directors wishes to announce the due diligence exercise had been put on hold as Versatile Smart Properties Sdn Bhd was requested by Double Action Ventures Sdn Bhd to relook the land conversion cost payment proposal within the deadline of two months,” it said in a filing with Bursa Malaysia yesterday.

Versatile Smart Properties is a wholly-owned subsidiary of Versatile Paper Boxes Sdn Bhd, which in turn is a wholly-owned subsidiary of Versatile Creative.

Versatile Creative added that Versatile Smart Properties will be seeking an extension of the memorandum of understanding (MoU) signed with Double Action and will finalise the draft definitive agreement upon finalisation of the land conversion payment issue.

“The company will make the appropriate announcement on any new development in relation [to] the MoU, if there is any,” it said.

On Jan 10, Versatile Smart Properties had entered into an MoU with Double Action to explore the feasibility of developing the apartments on a 1.29ha land in Johor Bahru.

The parties had agreed to conduct an evaluation of the project and a due diligence on Double Action, with a definitive agreement to be executed if the results of the study are satisfactory.

The parties had initially intended for a definitive agreement to be drawn up within four months from the MoU’s date.

In April, Versatile Creative said the due diligence was still in progress as Versatile Smart Properties and Double Action were in the midst of discussions with YPJ Builders on the issue related to the payment of land conversion.

Versatile Creative shares closed down one sen or 0.66% at RM1.50 yesterday, with a market capitalisation of RM176.01 million.

This article first appeared in The Edge Financial Daily, on July 11, 2017.

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