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LBS in talks with state agencies for JV in affordable housing projects

KUALA LUMPUR (Oct 9): Property developer LBS Bina Group Bhd is currently in talks to enter into joint ventures (JVs) with state government agencies for the development of affordable housing projects.

"We are still talking to one or two agencies in the government about this. We can't disclose too many details at the moment but we're looking at joint ventures with the state agencies," said group managing director Datuk Lim Hock San at a press conference today (Tuesday).

While the developments won't be under the 1Malaysia Housing Programme (PR1MA), Lim said it will be quite a sizeable project for LBS.

"We have been meeting with Housing and Local Government Minister Datuk Seri Chor Chee Heung, and I have told him LBS is committed to affordable housing," Lim added.

The group currently has 17 on-going development projects this year with a gross development value of RM1.73 billion, out of which 9 are affordable housing projects with terrace and apartment units within the range of RM150,000 to RM400,000 a unit.

"We already have 9,000 affordable housing units in the pipeline for the next two years. These will be located in Batu Pahat, Ipoh, Bandar Saujana Putra and Cameron Highlands with a GDV [gross development value] of RM2.5 billion," Lim said.

In total, LBS has a landbank size of 2,296 acres with a GDV of RM12.5 billion attached.

The group has also recently signed a Memorandum of Understanding (MoU) in April with Jiuzhou Technology Co Ltd (JTCL) for the sale of LBS's wholly-owned unit Dragon Hill Crop Ltd.

Up until now, news on the transaction has been quiet since the MoU signing but when asked on the status of the agreement, Lim said that "the deal is still progressing".

The MoU provides for the parties to negotiate exclusively with each other and finalise the scope and terms of a sale and purchase agreement for Dragon Hill, under which LBS may reap up to RM652 million based on an indicative price of about HK$1.65 billion (RM612.15 million).

Should the deal materialise, LBS will end up as a substantial shareholder of Hong Kong-listed Jiuzhou Development Co Ltd (JDCL), the state-owned parent company of JTCL that runs ferry services and a hotel chain in China.

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