Seremban Engineering enters JV with NS Corp to develop Jetty Arang land

• Based on its Bursa filing on Wednesday, both parties have also entered into a subscription and shareholders agreement (SHA) for the incorporation of a special purpose vehicle (SPV) to implement the joint venture.

KUALA LUMPUR (June 14): Seremban Engineering Bhd and Negeri Sembilan's investment arm NS Corp have entered into a joint venture agreement for the proposed development of three parcels of concession land, which includes the Jetty Arang, that cumulatively measure 26.381 acres in Port Dickson, Negeri Sembilan.

Based on its Bursa filing on Wednesday, both parties have also entered into a subscription and shareholders agreement (SHA) for the incorporation of a special purpose vehicle (SPV) to implement the joint venture.

Seremban Engineering holds an 80% stake in the SPV while NS Corp will hold the remaining 20%.

The primary objective of the SPV is to carry out the development project, as well as undertake jetty operations for exports and imports, warehousing, tank farms and related logistics.

Seremban Engineering will be mainly responsible for the arrangement of the financing, as well as for managing, overseeing and undertaking the carrying out of the projects.

The group will also be in charge of partnering with experienced port services operators for the operation of Jetty Arang during the concession period.

Meanwhile, NS Corp will be liaising and procuring the necessary approvals and licences from local authorities and other contractors, and is entitled to a facilitation fee of RM5 million payable in instalments of RM1 million per year.

Seremban Engineering stated that the joint venture will not have any effect on the total issued share capital, nor have any material effect on the net assets and/or earnings per share for the financial year ending June 30, 2023.

The group intends to fund the joint venture either through internally-generated funds, bank borrowings and/or a combination of both.

“The JV aligns with Seremban Engineering's strategic objective of expanding and diversifying its business operations for sustainable and profitable growth. It aims to diversify the company's income sources, thus reducing potential negative impact on its traditional business industry,” Seremban Engineering said.

The feasibility of the joint venture is subject to the approval of a study that is expected to be completed by the second quarter of 2024, barring any unforeseen circumstances.

Shares of Seremban Engineering closed unchanged at 82.5 sen with a market value of RM65.6 million.