Ekovest, IWCity soar ahead of Bandar Malaysia deposit payment

by FARA AISYAH / pic credit: ekovest.com.my

SHARES of Ekovest Bhd and Iskandar Waterfront City Bhd (IWCity) jumped yesterday on the news that a deposit payment ceremony for Bandar Malaysia will be held today.

Ekovest, Iskandar Waterfront Holdings (IWH) and TRX City Sdn Bhd announced deposit payment of RM1.24 billion and an RM500 million advancement to TRX City, which is wholly-owned by Minister of Finance Inc.

Ekovest shares surged 21% or 10.5 sen to close at 61 sen per share, the highest recorded since May, with 290.08 million shares traded.

The counter started trading in the afternoon session at 54 sen, before increasing seven sen or 12.96% following the news.

It was the top four active counters in the local bourse yesterday. IWCity closed at 66 sen yesterday, up 8.5 sen or 14.78% higher with 75.57 million shares traded.

After the afternoon session, the counter gained five sen or 8.2%, to close at the highest since June. Tycoon Tan Sri Lim Kang Hoo is the common shareholder for Ekovest and IWCity.

He is also the majority shareholder of IWH. Last week, Ekovest, in an exchange filing, stated it has received an exclusive offer to enter into negotiation with IWH to explore the participation of the company as a strategic investor in the Bandar Malaysia development project through the proposed acquisition by the company of 40% of the equity interest held by IWH in IWH CREC Sdn Bhd (IWH-CREC).

IWH, through IWH-CREC, a joint venture vehicle between IWH and China Railway Engineering Corp (M) Sdn Bhd had on Dec 17, 2019 entered into a restated and amended share sale agreement with TRX City in relation to the acquisition by IWH-CREC of a 60% equity interest in Bandar Malaysia Sdn Bhd to undertake the development of the Bandar Malaysia project.

“The board of directors of the company wishes to announce that the board has agreed to commence exclusive negotiation to finalise with IWH in relation to the proposal, with a view towards entering into agreement within 30 market days from the acceptance of the letter, unless extended with the consent of both parties,” the group noted.

Ekovest added that the Bandar Malaysia project is a prime national economic project in which its direct participation and investment in IWH-CREC will potentially generate billions in orderbook sales arising from future infrastructure and development of Bandar Malaysia, which has an estimated gross development value of RM140 billion.

In July, Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said TRX City had given IWC-CREC a four-and-a-half-month extension to pay the balance RM1.1 billion upfront deposit for the stake buy.

The deadline was moved to Sept 15, 2020 from Apr 30, 2020, due to the Covid-19 pandemic.

As at July, TRX City had received RM148.2 million of the RM1.24 billion advance from IWH-CREC.