BHIC to dispose of Penang shipyard land for RM28 mil, expects RM14.4 mil gain

PETALING JAYA (April 1): Boustead Heavy Industries Corp Bhd (BHIC) is disposing of three adjoining parcels of mixed industrial and building land in Penang for a total cash consideration of RM28 million.

In a filing with Bursa Malaysia yesterday (March 31), the group said its wholly owned subsidiary, Boustead Penang Shipyard Sdn Bhd, has entered into a conditional sale and purchase agreement (SPA) with Karya Koperat Sdn Bhd (a unit of property firm Ark Resources Holdings Bhd) for the disposal.

Disposal details

The transaction involves three adjoining parcels:

*Lot Nos: 3222, 9777 and 20238
*Title Nos: PN 649, HSD 6981 and HSM 3558
*Location: Mukim 13, District of Timor Laut, Pulau Pinang

The land — measuring approximately 26 acres and located in Pulau Jerejak — was previously used for the group’s shipbuilding, ship repair and offshore fabrication activities.

The RM28 million disposal consideration will be satisfied entirely in cash.

Expected gain and rationale

BHIC expects to record a one-off gain of approximately RM14.39 million from the disposal.

The group said the proposed disposal provides an opportunity to:

*Unlock value and monetise the subject properties
*Generate surplus cash flow for the group

The land has been largely idle and classified as non-core, following the cessation of operations.

Operational background

BHIC said utilisation of the shipyard assets declined significantly after October 2018, following the completion of a topside fabrication project, before ceasing entirely amid weaker market conditions.

The underutilisation was attributed to the prolonged downturn in global oil prices, which affected Malaysia’s oil and gas sector and the domestic shipbuilding and maintenance, repair and overhaul (MRO) industry.

Use of proceeds

The group intends to allocate approximately RM25.97 million from the disposal proceeds for general working capital, including:

*Settlement of trade and other payables
*Maintenance of MRO facilities
*Administrative and operating expenses

Transaction positioning

BHIC stated that the disposal reflects a monetisation of surplus, non-core assets, allowing the group to redeploy capital towards operational requirements.

Editor’s note: This article is based on Bursa Malaysia filings dated March 31, 2026, and publicly available disclosures as at the time of writing.

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