• The land will be used as FoundPac Tech's new manufacturing facility, as it is less than a kilometre away from the unit's existing manufacturing facilities.

KUALA LUMPUR (Dec 5): Precision engineering parts maker FoundPac Group Bhd is to fork out RM25.5 million to purchase industrial land measuring 8,365 square metres in the Bayan Lepas Free Industrial Zone in Penang, with a double-storey detached factory-cum-office building thereon, to increase its production capacity.

In a Bursa Malaysia filing on Friday (Dec 2), FoundPac said the group's wholly owned subsidiary FoundPac Technologies Sdn Bhd (FoundPac Tech) entered into a sale and purchase agreement with Zoomic Technology (M) Sdn Bhd, a unit of Iqzan Holding Bhd, to purchase two adjoining lots of industrial land.

"The purpose of the acquisition is to enable FoundPac Tech [to] increase its production capacity," the group said, noting that it envisages no major capital expenditure required to enhance the building to cater for its production requirement.

FoundPac noted that the land will be used as FoundPac Tech's new manufacturing facility, as it is less than a kilometre away from the unit's existing manufacturing facilities, and therefore represents an opportunity to contribute positively to FoundPac Tech's earnings in medium to long term.

Touching on the RM25.5 million consideration, FoundPac said it was arrived at a "willing buyer and willing seller" basis after taking into consideration, benchmarking and surveying the prices of properties in the industrial zone.

"The management of the [group] performs its own internal benchmarking by surveying the indicative value of the property via verbal communication with several valuers which concluded that the value of property ranges from RM24 million to RM26 million," FoundPac noted.

"The [RM25.5 million] purchase consideration will be financed via internally generated funds," it added.

The group said the acquisition is subject to the consent of state authorities as well as the Penang Development Corp.

Barring unforeseen circumstances, as well as the requisite approvals, FoundPac said the group expects to complete the acquisition by June 30, 2023.

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