Melati Ehsan to build 34.3 acres of residential development

KUALA LUMPUR: Melati Ehsan Holdings Bhd subsidiary Bayu Melati Sdn Bhd has entered into an agreement with a private company, Tengku Shahrudin Sdn Bhd (TSSB), to undertake a residential development project on a 34.2-acre land in Seksyen U10, Shah Alam, belonging to the latter.

In a statement to Bursa Malaysia Securities on Monday July 12, Melati Ehsan said the residential development known as Bukit Tengku Shah Alam would have a gross development value of RM270 million.

It said the development was expected to start in the last quarter of 2010 and completed by the first quarter of 2013. According to the terms of the agreement, Bayu Melati will make staggered payments totalling RM55 million to TSSB, which has a paid-up capital of RM3.7 million. TSSB's shareholders are Gan Seng Biang with a 90% stake and Lim Yap Hap with 10%.

The RM55 million will be paid in stages — RM2 million upon acceptance of the agreement, RM8 million upon execution of the agreement, RM10 million within 12 months, RM17.5 million within 22 months and RM17.5 million within 30 months.

Melati Ehsan said the proposed development was strategically located in Shah Alam, with a good network of roads and infrastructure.

The company said excluded from their agreement, TSSB had sold 23 plots of vacant bungalow lands in the project which is currently known as Bukit Tengku Shah Alam.

TSSB had paid the land premium for the issuance of the separate documents of title to the plot of land and the excluded lands amounting to RM4.23 million.

Melati Ehsan will also pay TSSB RM5.03 million for costs incurred in putting in place the basic infrastructure which had been earlier constructed by the latter on the plot of land within six months from the dates of execution of the agreement.

Melati Ehsan will also "pay the balance road contribution costs to the relevant authorities amounting to RM2.86 million or such other amount to be determined by the relevant authorities".