Under the proposal, YTL Land would settle the purchase through the issue of RM253.03 million of 10-year 3% stepping up to 6% irredeemable convertible unsecured loan stock (ICULS) at 100% of nominal value of 50 sen per ICULS and the remaining RM223.02 million in cash.
The rationalisation is expected to result in a net gain of RM51.96 million or 2.9 sen per share in YTL Corp.
In an announcement to Bursa Malaysia on Tuesday, Nov 23, YTL Corp said the rationalisation would enable it to unlock the value of its investments, property assets and projects by housing them under its property development arm, YTL Land.
YTL Land is a 60.72%-owned subsidiary of YTL Corp.
"This is in line with the YTL Corp group's ongoing strategy for its principal business arms to own and operate the relevant assets within their business spheres in order to leverage on operational and developmental efficiencies and synergies," it said.
YTL Corp will benefit from the potential earnings and capital appreciation of the parcels of land disposed to YTL Land via its existing shareholding in the property arm. The group's shareholding in YTL Land will increase upon conversion of the ICULS later.
The cash proceed from the rationalisation will be used for general working capital purposes.
The proposed exercise is expected to be completed by 1H11. The companies and the stakes to be taken up by YTL Land are: 100% interest in Arah Asas Sdn Bhd (AASB), 100% stake in Satria Sewira Sdn Bhd (SSSB), 70% interest in Emerald Hectares Sdn Bhd (EHSB), 100% stake in Pinnacle Trend Sdn Bhd (PTSB), 100% stake in Trend Acres Sdn Bhd (TASB), 100% interest in YTL Westwood Properties Pte Ltd (YTLW), 70% stake in Lakefront Pte Ltd (LFPL), 70% interest in Sandy Island Pte Ltd (SIPL), 100% stake in Budaya Bersatu Sdn Bhd (BBSB) and Bidor Land.
YTL Corp held its interest in LFPL and SIPL via wholly owned YTL Singapore Pte Ltd, while its interests in BBSB was through wholly owned Syarikat Pembenaan Yeoh Tiong Lay Sdn Bhd. Bidor land is held via its wholly owned YTL Land Sdn Bhd.
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