EcoWorld International completes 1st stage of UK acquisitions


EcoWorld International Bhd has completed the first stage of acquisitions under its joint venture (JV) with Be Living Holdings Ltd to develop 12 project sites in London, via a provisional payment of RM347.37 million.

In a statement yesterday, the group said the completed acquisitions will add six new sites to its existing three projects in London.

The estimated gross development value (GDV) of the six sites is about RM5.99 billion.

The new sites were acquired using proceeds raised from the group’s initial public offering (IPO) in April last year.

EcoWorld International CEO Datuk Teow Leong Seng (picture) said the completion of the acquisitions marked the start of “a new era” for the group in the UK.

“We are well-positioned to grow our UK business strongly to meet both local and international demand in the traditional open market sale (OMS) sub-sector, as well as rising institutional demand in the built-to-rent (BTR) sub-sector,” he said.

Local demand in the mid-mainstream market currently exceeds supply, Teow said.

The developer has also signed definitive agreements for the second stage of acquisitions, which will potentially add another six sites with an estimated GDV of £1.5 billion (RM8.3 billion), all within the UK as well.

The group’s total number of projects in the UK will increase to 15 in total upon completion of the second-stage sites.

Its share of the £40.36 million estimated purchase consideration for the second-stage acquisitions is expected to be funded by bank borrowings, other debt instruments and/or internally generated funds.

This is in view of its gearing level of 0.05 time as at Oct 31 last year, after taking into account the RM2.5 billion raised from the IPO.

In December 2017, EcoWorld International announced its intention to acquire a 70% stake in the JV with Be Living, a subsidiary of UK contractor and developer Willmott Dixon Holdings Ltd.

The group said through the JV, its UK business will expand its geographical reach beyond the current Central London locations to Greater London and south-east England, as well as broaden its product range to mid, upper-mid and prime residential market segments.

EcoWorld International’s customer base will also widen beyond individual home owners and investors to institutional funds looking to acquire BTR properties in ideal locations.

All 12 sites are located within the London commuter belt in areas where the local population live and commute to the capital for work. The sites are also in close proximity to public transportation access.

Five out of the six stage-one acquired sites have secured depots, track works, rolling stock, signalling, power supply and other associated works.

The company’s directors have declared a third interim dividend of five sen per share on the enlarged 563.27 million shares amounting to RM28.16 million.

Two interim dividends of 2.5 sen per share and two sen per share were paid on the enlarged share capital amounting to RM25.35 million on Nov 9 last year and Jan 12, 2018, respectively.

The total dividend for the financial year will be RM53.51 million, which rose 43%. planning consent, which will enable the projects to be launched within the next one to two years, while Milbrook Park, Kensal Rise and Maida Hill have launched phases which can be made available for sale within the current financial year ending Oct 31, 2018 (FY18).

EcoWorld International is also planning to pursue the forward sale of one or two BTR blocks within the other projects, which will further contribute towards the group’s sales performance for FY18.

It targets to complete the Kew Bridge and Aberfeldy Village sites within FY18, while the remaining sites are proposed to be completed subject to obtaining the necessary approvals