KUALA LUMPUR (July 5): Bertam Alliance Bhd is selling two parcels of freehold land at Batu 9, Cheras, with a collective land size of 47,930 sq m (11.8 acres) to a unit of Guocoland (Malaysia) Bhd, for RM128 million.
According to its bourse filing today, Bertam expects to recognise a RM79.84 million disposal gain arising from the land deal.
The sale was effected via Bertam's unit MV Properties Sdn Bhd, which inked a sale and purchase agreement with Tujuan Optima Sdn Bhd, Guocoland's subsidiary.
Both the lands are located at Batu 9. The first land, which measures 36,928 sq m, is categorised as a building land, while the second piece with land area of 11,002 sq m is categorised as agriculture land for rubber plantation.
The land's audited net book value (NBV) was RM42.96 million as at Dec 31, 2015 (FY15). It was valued at RM125.11 million, as appraised by independent valuer DTZ Nawawi Tie Leung Property Consultants Sdn Bhd, on March 19, 2016.
Bertam believed the proposed disposal will enable it to unlock and realise the value and capital appreciation of the lands, aside from the one-off net gain of RM79.84 million.
It has earmarked the proceeds raised for full repayment of borrowings and working capital.
"Upon full utilisation of the proceeds earmarked for full repayment of borrowings, Bertam Group will have zero gearing level and shall incur interest cost savings of approximately RM7.3 million per annum based on the effective rate of 6% to 8.6% per annum," it added.
According to the filing, it has accumulated losses of RM38.51 million, while total borrowings stood at RM103.87 million as at Dec 31, 2015 (FY15).
It is confident the deal will be able to strengthen its financial performance moving forward.
Barring any unforeseen circumstances, it targets to complete the sale by the fourth quarter of 2016.
Bertam Alliance closed up three sen or 5.49% to close at 48 sen, for a market value of RM99.24 million. — theedgemarkets.com
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