KUALA LUMPUR: Ivory Properties Group Bhd will incur a higher rate of 8% per annum, or RM7.66 million, in its third instalment payment for land it bought in Penang, after being granted an extension of six months to pay up by Penang Development Corp (PDC).
In a filing with Bursa Malaysia yesterday, Ivory said it had entered into a second supplemental agreement (SSA) with Chief Minister of Penang (CMI) and PDC to amend and clarify certain terms of the principal agreement.
Under the SSA, it was granted a second extension of time to pay up the third instalment, with the 8% rate calculated from the extended period of Feb 10 to Aug 10, 2014, amounting to RM7.66 million.
Prior to that, Ivory had been given a three-month extension to pay the third instalment, commencing from Nov 10 last year to Feb 10, 2014, at a rate of 5% per annum.
To recap, the Penang-based property player had entered into a purchase and development agreement in 2011 with CMI and PDC to purchase and develop a 41.5ha piece of land in Bayan Mutiara, in the north-east district of Penang, for a total consideration of RM1.07 billion.
The firm had also inked a joint venture agreement with Dijaya Corp Bhd for the purchase and development of the land, with a gross development value of RM10 billion.
Ivory said yesterday that under the SSA, it would not be able to sell or transfer any parcel of land — except for a parcel known as Parcel 2(a) — to other developers or nominated companies unless it is with the written consent of PDC. PDC reserves the right not to grant such consent.
In addition, once Ivory has settled the payment of the land and all interest incurred, it can — prior to the completion of the development — sell any retail property to be developed on the land to a bona fide purchaser for value on an arm’s length basis.
This article first appeared in The Edge Financial Daily, on June 25, 2014.