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IJM Land ends JVs with Talam

KUALA LUMPUR: IJM Land Bhd unit IJM Properties Sdn Bhd has terminated three joint venture (JV) agreements, two of which were inked with Talam Transform Bhd in 2006 and 2007, saying the deals could not realise their “commercial objectives”.

In a filing with Bursa Malaysia yesterday, IJM Land announced that IJM Properties has entered into three agreements to terminate their respective JV agreements for landbank development in Selangor totalling 453.04 acres (183.3ha).

“The joint ventures are [being] terminated as the intended commercial objectives of the respective joint ventures are unlikely to materialise,” said IJM Land in its filing.

Two of the three JVs involve related parties. The two companies concerned are GL Development Sdn Bhd and Mutual Prosperous Sdn Bhd, which are subsidiaries of Talam Transform, in which IJM Land holds an indirect stake.

IJM Land, the property arm of IJM Corp Bhd, owns a 25.1% equity stake in Kumpulan Europlus Bhd (KEuro), which in turn holds a 29.89% stake in Talam.

The two terminated JVs were entered into at a time when debt-ridden Talam, which was then under the control of tycoon Tan Sri Chan Ah Chye, was in the midst of being restructured. Emerging as a white knight, IJM Corp bought an equity stake in KEuro and proceeded to take over and complete some of Talam’s development projects.

Chan and his wife, Puan Sri Thong Nyok Choo, ceased to be substantial shareholders of Talam following the disposal of 115.4 million shares in KEuro Bhd to MWE Holdings Bhd in October 2013.

Prior to the transaction, Chan held a 23.02% stake Talam and was the major shareholder in KEuro.

IJM Land terminated the 50:50 JV agreements with GL Development (under Good Debut Sdn Bhd) and Mutual Prosperous (under Cekap Tropikal Sdn Bhd) for the development of land in Ulu Kelang and Mukim of Batu in Gombak respectively.

The proposed development in Ulu Kelang spanned approximately 17.84 acres while the piece of land in Gombak measured 204 acres. The JV agreements for the developments in Ulu Kelang and Gombak were entered into in November 2006 and March 2007 respectively.

The third JV agreement that was terminated was entered into with Star Everest Sdn Bhd, under Sierra Selayang Sdn Bhd, in January 2006 for the proposed development of about 231.2 acres of land in Gombak, Selangor.

“The terminations will not have any significant effect on the earnings or net assets per share of the company for the financial year ending March 31, 2015,” said IJM Land.


This article first appeared in The Edge Financial Daily, on May 23, 2014.

 

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