KUALA LUMPUR: Kulim (Malaysia) Bhd and KPJ Healthcare Bhd, subsdiaries of Johor Corp (JCorp), had proposed to divest their properties to to Al-'Aqar KPJ Real Estate Investment Trust (REIT), according to separate announcements on March 9.

Kulim will divest its Menara Ansar in Johor Bahru, to Al-'Aqar KPJ Real Estate Investment Trust (REIT) for RM105 million.

The disposal will be satisfied partly by RM63 million in cash, while the remainder will be satisfied via the issuance of 42.9 million new units of Al-'Aqar REIT at an issue price of 98 sen per unit, said Kulim managing director Ahamad Mohamad.

“The group has opted to dispose our investment in Menara Ansar as it would allow us to unlock the value of our non-core asset as well as to realise our investment in the property.

“The divestment would also allow us to utilise the proceeds for the repayment of borrowings, which currently stand at RM1.70 billion and lower our gearing from 0.33 times to 0.32,” said Ahamad.

He added that the REIT would be a good investment for the group, given its dependable and respectable performance over the last two years, having paid its shareholders dividends of 8.1 sen in 2008 and 7.32 sen in 2007.

The transaction is expected to be completed by 3Q2010.

Menara Ansar stands on 9,739 sq m of freehold land, and contains 21 stories of office space and a three-level basement carpark. According to Kulim, the building has an occupancy rate of 92%.

In the three months leading to Dec 31, 2009, Al-'Aqar had reported it has an existing fund size of 518.37 million units, with current assets totalling RM49.81 million and a real estate portfolio of around RM961.5 million. Al-'Aqar owns and invests in Syariah-compliant healthcare-related properties.

Meanwhile, KPJ and its subsidiaries had proposed to divest their interest in the Rumah Sakit Bumi Serpong Damai, Kluang Utama Specialist Hospital and Bandar Baru Klang Specialist Hospital buildings to Al-’Aqar for a total sale consideration of RM138.77 million to be satisfied via a cash consideration of RM83.26 million and the remainder RM55.51 million by the issuance of 56.64 million new units in the REIT at 98 sen each.

According to an announcement on Bursa Malaysia, the estimated capital gain from the proposed disposal is about RM3.36 million, resulting in an improvement in the earnings per share (EPS) of KPJ by about 0.98 sen each, based on 527.62 million shares of 50 sen each as at March 1.

It will also result in a cash inflow of RM83.2 million, and allow KPJ to realise its property investments, said KPJ.

The Rumah Sakit Bumi Serpong Damai building, owned by KPJ subsidiary PT KPJ Medica is a 7-storey building with a land area of 12,000 sq m and a gross floor area of 22,112 sq. m. With a leasehold tenure, the building is currently fully occupied.

The Kluang Utama Specialist Hospital building, owned by subsidiary Pusat Pakar Kluang Utama Sdn Bhd, comprises six units of 3-storey renovated shoplots. It has a land area of 985.38 sq m and a gross floor area of 2,956.17 sq m. The leasehold property also has full occupancy.

Meanwhile, the Bandar Baru Klang Specialist Hospital building is a partially completed, 6-storey purpose-built private specialist hospital building with two levels of basement carpark. The registration of transfer for the building by the previous owner in favour of Bandar Baru Klang Specialist Hospital Sdn Bhd, formerly known as Ipoh Radiotherapy Sdn Bhd, is pending following a novation agreement.

In an earlier announcement to Bursa Malaysia, Al-’Aqar had offered to acquire a number of properties from JCorp subsidiaries KPJ, Kulim and Rumah Sakit Medika Permata Hijau building and Selesa Beach Resort Port Dickson building for a total purchase consideration of RM302.91 million.

The payment was to be satisfied via a total cash consideration of RM181.75 million and the remainder RM121.16 million via the issuance of 123.61 million new REIT units at 98 sen each.