Controversial land deal

KUALA LUMPUR: A company owned by an executive with links to former Metroplex Bhd’s major shareholders has taken control of some 100 acres (40.46ha) of land at the foot of Genting Highlands after a controversial court convened meeting of scheme creditors last Friday.

The company Hana Bestari Sdn Bhd, with Robert Ti as director and major shareholder, has obtained the required approval for the scheme. The land purchasers are compensated at 40 sen per sq ft (psf) for their respective parcels of land, which they acquired 20 years ago at RM4 psf.

Surprisingly, among the land purchasers, a major supporter of Hana Bestari’s proposal is Konsortium Enterprises (M) Sdn Bhd, which is controlled by Lim Siew Kim, daughter of the late tycoon Tan Sri Lim Goh Tong.

Ti was aligned to Lim in his capacity as a financial adviser, when the latter was up against Sunway REIT in the fight for the Putra Place property in 2011.

The 100 acres at the foot of Genting were owned by Peninsular Park Sdn Bhd, a 75% subsidiary of Metroplex.

Peninsular Park has sold 190 lots of land since 1993 for a project that is to be developed as a farmstead. The land was charged to Alliance Bank but the project did not take off.

In June 2012, the project was due to be auctioned off but Hana Bestari stepped in to settle with Alliance Bank and a vulture fund for the RM72 million debt. In return, Hana Bestari took over the assets and the scheme creditors.

In a circular to the scheme creditors issued on Nov 18, Hana Bestari offered to compensate the land purchasers, who are the scheme creditors, 10% of the purchase consideration.

This worked out to about 40 sen psf but some land owners contended the land was acquired at RM4 psf in 1993.

According to officials, Hana Bestari managed to get the necessary shareholder approval to push the scheme through, largely with the support of Konsortium Enterprise that owns 41 of the 190 lots.

This comes as a surprise as Lim is known to be a person who will not easily dispose of assets at a cheap price.

For instance, when Sunway REIT won the auction for Putra Place in 2011, Metroplex, which is controlled by Lim, did not easily give up.

Metroplex filed for legal action to stop Sunway from taking possession of Putra Place but could not prevent the takeover of the property.

In this present land deal, Konsortium Enterprise owns 41 of the 190 lots of land, according to the circular issued to the scheme creditors.

Of the total price of RM3.91 million for the 41 lots under the sale and purchase agreement (SPA), Konsortium Enterprise had paid RM4.4 million, which was above the full purchase price. This had raised questions in the court-convened meeting on the amount which was overpaid.

“I suspect something is not right. How could it be that their [Konsortium Enterprise] lots have received a more advanced completion, when the rest of the land purchasers have not?” said a land purchaser.

The other purchasers said they have only paid 50% of the SPA price so far, as the development schedule in the SPA has not been completed.

The meeting saw some controversy as a group of eight land purchasers who had placed private caveats on their lots were not allowed to attend the scheme creditors meeting.

As Konsortium Enterprise owns a majority in value of the lots of land, Hana Bestari managed to obtain more than 50% approval, representing a 75% value of each class of scheme creditors present at the meeting.

“Had the eight land purchasers been allowed to vote, the value of votes would have been less than 75%, and the result would have been different,” said one of the voters.

The majority of the land purchasers said they will challenge the decision in court, as the scheme manager will have to file the deal with the court and have it approved or recognised before it becomes official and binds all the purchasers.

The purchasers want their land parcels back because the values have gone up.

This article first appeared in The Edge Financial Daily, on December 16, 2013.


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