Mah Sing sells two properties for RM560m

By THE STAR

KUALA LUMPUR: Mah Sing Group Bhd has sold its two new commercial properties in Kuala Lumpur for RM560.6mil to Prompt Symphony Sdn Bhd, a 80:20 special purpose vehicle set up by Kuwait Finance House and Autron Corp Ltd to acquire the properties.

The sale of The Icon Jalan Tun Razak (East Wing) and The Icon Mont’ Kiara, via wholly owned subsidiaries Star Residence Sdn Bhd and Maxim Heights Sdn Bhd, was for about RM237mil and RM285.4mil respectively, a company statement said yesterday.

The group has also signed a “put and call agreement” to sell not less than 301 parking bays in The Icon Jalan Tun Razak for RM18.15mil and 637 bays in The Icon Mont’ Kiara for RM19.9mil.

“This is the first direct en bloc purchase by Kuwait Finance House in Malaysia,” the statement said.

Group managing director Datuk Seri Leong Hoy Kum said the sale was an endorsement of Mah Sing and a stamp of approval for the group’s achievements in property development.

Datuk Seri Leong Hoy Kum (left) and Autron CEO Eric Lim Kheng

“In view of our branding and track record for on-time delivery, investors also have confidence in the potential and prospects that we offer in developing high value, high quality projects in strategic growth areas.

“These are the second and third sales within four months, boosting the group’s commercial en bloc sales to RM734.9mil,” he said.

In July, Mah Sing sold The Icon Jalan Tun Razak (West Wing) to Koperasi Permodalan Felda for RM174.4mil.

The group’s remaining gross development value (GDV) of RM3.04bil and unbilled sales of RM1.08bil represented a total GDV of RM4.12bil that will ensure earnings visibility for seven years.

Leong said Mah Sing would seek further opportunities to sell en bloc its two other commercial projects – Southgate Commercial Centre in Kuala Lumpur and Southbay City @ Southbay, Batu Maung, in Penang.

The two projects, with GDV of RM256mil and RM911mil respectively, will be launched in the first half next year.

An analyst at SJ Securities said the latest sale would bring in substantial “quick cash” to Mah Sing as Prompt Symphony would be paying 80% of the purchase price upon the signing of the sale and purchase agreement, compared with the usual payment of 10%.

He said the cash would provide working capital to the group for its expansion overseas, noting that the group was looking at Ho Chi Minh City and Hanoi in Vietnam.

In addition, the deal with Kuwait Finance House would open up other opportunities from the cash-rich group in the future, the analyst said.

CIMB Investment Bank analyst Terence Wong said the property sale would have substantial impact on the group’s earnings, given the premium price.

Meanwhile, Mah Sing posted a 28.1% increase in net profit to RM61.8mil for the nine months ended Sept 30.

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