KUALA LUMPUR: Mah Sing Group Bhd's wholly-owned subsidiary Klassik Tropika Development Sdn Bhd is disposing of a 13,694.95 sqm tract of freehold land in George Town, Penang, for RM66.33mil.
The property group said in the filing with Bursa Malaysia it had signed a sale and purchase agreement with real-estate firm Morningjoy Sdn Bhd to dispose of the land along Pykett Avenue off Jalan Burma on Penang island.
It said the land was acquired by Klassik Tropika in 2009 for a proposed high-end condominium development.
In its rationale for the disposal, Mah Sing said it is in line with its strategy to focus more on M-Series type of residential lands for the development of affordable properties, in line with market demand.
"Disposal of the Land and replacement with M-Series lands with faster turnaround time will help to optimise efficiency of the group’s landbank.,
"The proceeds unlocked from the monetisation of the undeveloped Land will free up cash for utilisation by the Group for future land acquisitions," it said.
Mah Sing said the land is predominantly flat and vacant as well as free from all encumbrances
The net book value of the land as at June 30, 2022, was RM61.85mil.
According to the group, as the loan facility for the land has been fully settled, the proceeds from the proposed disposal are expected to enhance its cash and bank position.
The proposed disposal is expected to generate a gain of about RM1.8mil upon completion after deducting all the estimated expenses for the proposed disposal.
Mah Sing said the proposed disposal is expected to be completed in the fourth quarter of 2022.