AME Elite buys more land in Johor for industrial cluster development

• According to AME Elite, the proposed acquisition, which is expected to be completed by the third quarter of this year, presents a strategic investment opportunity to increase its land bank.

KUALA LUMPUR (May 31): AME Elite Consortium Bhd (KL:AME) is buying three parcels of freehold land, measuring 37.5 acres, in Kulai, Johor for RM106.17 million to develop an industrial cluster.

The acquisition was made through its wholly owned subsidiary Golden Symphony Sdn Bhd, which entered into a sale and purchase agreement with Dahlia Utama Sdn Bhd, the owner of the palm oil estate, according to its filing with Bursa Malaysia.

According to AME Elite, the proposed acquisition, which is expected to be completed by the third quarter of this year, presents a strategic investment opportunity to increase its land bank.

“AME Group is also in preliminary discussions with certain land owners in and out of Johor to explore potential and development opportunities on sizeable land. However, the group has not identified or committed to any acquisition and development targets,” it added.

The purchase consideration for the subject lands is equivalent to RM65 per square foot and was arrived at on a “willing buyer and willing seller” basis.

This valuation considers the market value of the subject lands, estimated at RM108 million or RM66.12 per square foot by independent valuer Knight Frank Malaysia Sdn Bhd, representing a discount of 1.73% from the market value.

AME Elite said that 90% of the purchase consideration will be financed through external borrowings, with the remaining 10% covered by internal funds. As of the end of March, the group's total cash and cash equivalents amounted to RM279.74 million, while total borrowings stood at RM174.7 million.

At Friday’s noon break, shares of AME Elite were two sen or 1.17% lower at RM1.69, valuing the group at RM1.08 billion.

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