SP Setia sells 8 parcels of land for RM518.15 mil

By SHAHEERA AZNAM SHAH / Pic by TMR FILE PIX

SP Setia Bhd is selling eight parcels of its development land measuring about 959.72 acres in Tebrau, Johor to a subsidiary of Scientex Bhd, Scientex Quatari Sdn Bhd, for RM518.15 million.

The property developer said its indirect wholly-owned subsidiary, Pelangi Sdn Bhd (PSB) has entered into a conditional sale and purchase agreement (SPA) with Scientex’s property arm.

Currently, the land is registered for agriculture use and planted with matured oil palm trees.

SP Setia president and CEO Datuk Khor Chap Jen (picture) said the sale is part of the group’s business strategy to improve its efficiency by monetising some land banks to be ploughed back into other projects for immediate launches as well as pairing down debt or other use deemed fit by the company.

Khor added that the sale is expected to contribute positively to SP Setia’s profits for the next few years.

“Our focus for this financial year is to optimise the current landbank utilisation and by launching properties that are in-demand within our matured townships,” he said in a bourse filing on Friday.

The property developer said the first phase of the disposal is expected to be completed in the first quarter of 2022 (1Q22) while the second phase will be in 2Q23 and the third phase in 2Q24.

It added that while the proposed disposal does not require approval of SP Setia’s shareholders, it is conditional upon the following approvals from Economic Planning Unit (EPU) for the land acquisition, the Estate Land Board and any other relevant authorities or parties if required.

The property developer currently has 11 ongoing projects in the Southern region, and post-sale of the above, the group will still have an effective total remaining land bank of approximately 7,569 acres.

As of Dec 31, 2020, SP Setia has 48 ongoing projects with an effective remaining land banks of 8,528 acres valued at a gross development value (GDV) of RM136.87 billion and total unbilled sales of RM10.05 billion.

The group has established its projects in the three key economic centres of Malaysia – Klang Valley, Johor Bahru and Penang while building its footprint in Sabah through an integrated city development in Kota Kinabalu.

For its international footprint, SP Setia is currently established in six countries – Vietnam, Australia, Singapore, China, the UK and Japan.

SP Setia’s share price closed at RM1.06, 2.91% or 3 sen higher, lifting its market capitalisation to RM4.30 billion.