In a statement to the exchange on Tuesday April 27, SunCity said the acquisition would enable the acquirer to capitalise on an "attractive" property development opportunity on a piece of vacant tract adjacent to the Sunway Pyramid Shopping Mall.
"There are no additional business and commercial risks to be assumed by SunCity pursuant to the proposed cquisition of SPM as SunCity is at present the controlling shareholder of SPM through Sunway Pyramid" SunCity said.
The tract, whose size was not revealed, is intended for a planned development comprising a 28-storey mixed-use commercial building with office and retail elements.
The project to include 1,027 car parks, will have pedestrian and vehicle access direct to the Sunway Pyramid Shopping Mall.
"Hence, SunCity believes that the aforesaid development plan will contribute positively to the future performance of SunCity and its subsidiaries," SunCity said.
The value of the development was not specified. The acquisition of SPM is due for completion by the second half of 2010.
SunCity was recently dragged into the spotlight when the company announced its plan to establish a real estate investment trust - Sunway REIT. The property trust, with a potential asset base of some RM4 billion comprises commercial properties under the group.