​​Southern Steel disposes of lands in Johor for RM65m to repay borrowings

KUALA LUMPUR (Dec 3): Southern Steel Bhd is disposing of two parcels of land in Sungai Tiram, Johor for RM65 million cash, to repay the group’s borrowings. 

The steel company inked a conditional sale and purchase agreement with aluminium manufacturer Sinppa Industrial Sdn Bhd for the land disposal measuring approximately 31.05 acres.

The price consideration was arrived at on a willing buyer-willing seller basis, said Southern Steel in a bourse filing on Thursday (Dec 2), adding that the group expects to realise an estimated net gain of approximately RM6.42 million from the disposal. 

Following the disposal, the group’s gearing ratio is estimated to reduce to 1.10 times, from 1.19 times, it added. 

Barring any unforeseen circumstances, the exercise is expected to be completed in the second half of 2022.

At the closing bell on Thursday, Southern Steel shares were down two sen or 2.6% to 75 sen. 

The group has a market capitalisation of RM444.37 million. 

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