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Permaju enters another conditional SPA to acquire HDSB

KUALA LUMPUR: Permaju Industries had on Sept 6 entered into another supplemental sale and purchase agreement (SPA) with Hardie Development Sdn Bhd (HDSB) to revise some of the terms under an earlier SPA dated March 5, Permaju announced on Bursa Malaysia on Tuesday, Sept 7.

Under the supplemental SPA, instead of paying RM33.68 million to HDSB, Permaju will only pay a deposit of RM3.37 million to the vendors with the remaining sum of RM21.63 million to be paid only upon fulfillment of conditions precedent as set out in the supplemental SPA.

The conditions include the results of a due diligence exercise carried out by the Permaju on HDSB being satisfactory to the former.

In March, Permaju had proposed to acquire a 70% stake in HDSB comprising 70 shares for a total consideration of RM33.68 million.

According to earlier filings, HDSB had in 2003 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.

The company had proposed to develop a mixed residential and commercial project called Princess Heights on the site within five to eight years from the date of commencement, which is no later than three months from the date of issuance of all necessary documents from the relevant authorities.

HDSB was to carry out the construction and completion of the development at its own cost and expense.

According to earlier announcements, for the financial year ended Jan 31, 2009, HDSB had incurred losses after tax of RM15,875 while its net liabilities stood at RM41,953.

The acquisition is deemed a related party transaction as one of the vendors, Datin Pang Fook Kyun, is the wife of Datuk Lim Yen Ngiap who is a director and major shareholder of Pemaju.

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