MIECO Chipboard Bhd plans to dispose of two pieces of industrial land in Kuantan, Pahang, for RM40 million to G-Force Sdn Bhd, a transportation company.
The move is part of Mieco’s effort to reduce fixed overhead costs and enhance production efficiency by consolidating operations at its Kuala Lipis plant.
The disposal will result in an estimated net loss of RM2.45 million.
The two leasehold industrial properties, located in Kawasan Perindustrian Gebeng, span approximately 17.76 hectares with a built-up area of 638,767 sq ft, comprising factory, warehouse, and ancillary buildings aged between eight and 30 years.
Mieco originally acquired the properties in 2005 for RM62.44 million, but their carrying value stood at RM42.45 million as of December 31, 2023.
According to the company, the sale proceeds will be allocated towards debt redemption of RM24 million, working capital of RM15.7 million, and transaction-related expenses of RM300,000.
Mieco highlighted that the disposal, which has been in the works for over a year, aligns with its efforts to improve liquidity and strengthen its financial position amid a volatile business environment.
The transaction is expected to be finalised in the second half of 2025, pending approval from the Pahang state authorities for the transfer of the leasehold properties. — TMR
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