Permaju to diversify into property development

KUALA LUMPUR: Following its proposed acquisition of property development company Hardie Development Sdn Bhd (HDSB), Permaju Industries Bhd has proposed to diversify into property development.

In a Bursa filing on Wednesday, Oct 20, the group said it expected its property development activities to divert at least 25% of its net assets from existing business activities or contribute to at least 25% of its net profit, as the launch of its first project is slated for the fourth quarter of 2010.

“The proposed diversification is part of the group’s plan to expand its business activities to enhance the group’s overall long term growth prospects,” it said.

It added that its foray into property development will contribute positively to its future earnings and improve its financial position, given the prospects and dynamism of the property development industry.

“Furthermore, the proposed diversification will provide the group with an additional revenue stream and may potentially contribute to stable earnings growth for the group in the future,” it said.

In 2003, HDSB had entered into a joint venture agreement (JVA) with Supernesa Sdn Bhd to develop a 109.41-acre tract of state land in Menggatal, Kota Kinabalu.

The market value of the leasehold land at the date of valuation on Dec 22, 2009 was RM64.62 million.

Permaju said it would convene an EGM at a later date to seek its shareholders’ approval.