Astacanggih acquisition an opportunity to increase landbank - Boustead

KUALA LUMPUR (Jan 3): Boustead Holdings Bhd (BHB) has announced that its recent acquisitions regarding shares in Astacanggih Sdn Bhd (Astacanggih) are a corporate exercise that presents an opportunity for the group to increase its land bank.

In a filing to Bursa Malaysia today, BHB said economies of scale can be achieved by combining the 80.9371 ha. development land at Bukit Raja with the adjacent 283.28 ha. land held under Jendela Hikmat Sdn Bhd.

Jendela Hikmat is a company in which the Boustead Group and Lembaga Tabung Angkatan Tentera (LTAT) jointly hold a 60 per cent equity interest. Based on its experience, BHB said it is confident the acquisition of the development land will be able to generate a return on development cost of 25 per cent from the RM160 million investment.

On Dec 27, 2012, BHB announced its wholly-owned subsidiary Bakti Wira Development Sdn Bhd was acquiring an 80 per cent stake in Astacanggih Sdn Bhd.

The acquisition formed part of the corporate exercise to acquire an 80 per cent interest in the 80.9371 ha. development land in Bukit Raja at a total price of RM160 million or RM18.37 per sq. ft.

BHB and Bakti Wira Development had started negotiations with Awan Megah Sdn Bhd on their proposed sale of the Bukit Raja land on April 11, 2005. BHB received an offer letter from the shareholders of Astacanggih on their proposed sale of Astacanggih on June 15, 2012.

However, the group was only able to conclude the final agreements in the third week of December 2012 after a prolonged negotiation with the respective parties. - Bernama

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