KUALA LUMPUR (July 12): Ireka Corp Bhd (Ireka) has aborted the freehold land acquisition measuring 21.52 acres (8.71 hectares) in Senawang, Negeri Sembilan, citing non-fulfillment of the conditions precedent under the agreement which it had inked with the AEON Co (M) Bhd (Aeon).

The construction outfit first announced the land acquisition deal, worth RM21.8 million in December 2014.

Concurrently, it had entered into a separate sale and purchase agreement with Aeon for the disposal of the land, following obtainment of necessary approvals from the relevant authorities to allow the construction and operation of a shopping centre, upon terms and conditions as stated in the Aeon SPA (land acquisition agreement).

Today, Ireka said both agreements were now terminated, due to the non-fulfillment of the conditions precedent under the AEON SPA.

On the Aeon SPA, it said the conditions precedent under the Aeon SPA could not be fulfilled within the conditional period and the renewed period of 18-month from the date of the Aeon SPA.

"Pursuant to Clause 3.1 of the Aeon SPA, the SPA shall now be deemed terminated with no further effect and neither party shall have any further claim in respect of the Aeon SPA," it added.

Despite the terminations, Ireka said there will be no effect on its earnings and net assets.

According to its filing then, Ireka was optimistic that the proposed acquisition is a good opportunity for it to employ its capability as both a developer and design and build contractor, for a large multi-national corporation like AEON.

"The land is located in a prime commercial area in the town centre of Senawang and is served by a good network of roads, including the Kajang-Seremban Highway (LEKAS) and the North-South Highway (PLUS)," it said.

Ireka had then said the proposed acquisition was expected to contribute positively to the earnings of the group for the financial year ending March 31, 2017.

Shares in Ireka were not traded today. They were last closed at 50 sen on July 4, giving Ireka a market value of RM85.43 million.— theedgemarkets.com

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