LSH Capital inks development deals with combined GDV of RM904 mil

KUALA LUMPUR (March 2): Lim Seong Hai Capital Bhd (KL:LSH) has entered into two deals for mixed development projects in Kuala Lumpur and Selangor, with a combined estimated gross development value (GDV) of RM903.9 million.

LSH said its wholly owned subsidiary Astana Setia Sdn Bhd signed an agreement with Airman Sdn Bhd—a company fully owned by LSH’s major shareholder and non-executive chairman Tan Sri Lim Keng Cheng—for a 52-storey mixed development along Jalan Pahang in Setapak.

The project, with an estimated GDV of RM500 million, spans multiple lots with a principal approval plot ratio of 6.4 and includes an existing three-storey shophouse, the group said in its exchange filing on Friday.

The collaboration is deemed a recurrent related party transaction.

Separately, LSH Best Builders Sdn Bhd, another wholly owned unit of LSH, entered into an agreement with Bakti Jaya Impian Sdn Bhd (BJISB) for a mixed residential and commercial development in Gombak, with an estimated GDV of RM403.9 million. BJISB’s sole shareholder is Syed Azelan Syed Yusof.

LSH said both collaborations fall under the group’s BEST Collaboration Framework, which provides construction-related services and solutions.

Under the agreements, LSH's subsidiaries are entitled to tender for works and be recommended as nominated suppliers for building materials and machinery rental, as well as hold first right of refusal for construction works on proposed alternative designs, subject to mutually agreed pricing and terms.

In return, the subsidiaries will receive profit sharing equivalent to 75% of the gross profit of each development, after deducting headquarters costs directly attributable to the projects.

The group said the collaborations will not have any immediate impact on its share capital, net assets, gearing, or earnings but are expected to contribute positively to future earnings once the projects are launched and sales agreements executed.

LSH shareholders green-light Morib rejuvenation project

A day earlier, LSH announced that its shareholders have approved all resolutions in an extraordinary general meeting relating to Besteel Engtech Sdn Bhd’s subscription of new shares in two special-purpose vehicles (SPVs) established to undertake the Morib rejuvenation project.

Approvals also covered the group’s provision of financial assistance to the SPVs to facilitate implementation and financing.

The approvals pave the way for structured execution of the project via the two dedicated SPVs—LSH Morib Golf & Country Club Sdn Bhd and LSH Morib Development Sdn Bhd—with LSH Best Builders holding 70% and Besteel 30% of each SPV upon completion of the subscription.

The Morib rejuvenation project gives LSH Capital access to 450 acres of land bank, comprising the core development footprint and a right of first refusal over additional land. The first 150 acres under the development component carry a preliminary estimated GDV of RM850 million over a 10-year period.

Shares in LSH closed down five sen or 2.5% at RM1.97 on Friday, valuing the group at RM1.65 billion. Over the past one year, the stock has gained nearly 140%.

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