Purchase made through joint venture with Khazanah vehicle
KUALA LUMPUR: Sunway Bhd has expanded its landbank in Johor with the acquisition of two parcels of leased land worth RM745.3mil in Medini Iskandar via a joint venture vehicle with Khazanah Nasional Bhd.
The two parcels, which are adjacent to each other, total about 691 acres and has an estimated gross development value (GDV) of RM12bil.
The newly acquired land known as Zone F Medini will boost Sunway's landbank by 30% from the previous 2,145 acres, while the proposed development will boost the company's current GDV to RM32bil,” Sunway said in a statement yesterday.
“With the acquisition, Sunway will have 755 acres of development land in Johor, in addition to the existing land at Bukit Lenang, with an estimated total GDV of RM13bil.”
Zone F Medini is strategically located in the heart of Iskandar Malaysia. It is about 10 minutes from Singapore via the Second Link Expressway and 25 minutes from the Senai International Airport.
Also in the vicinity are Legoland Malaysia and Pinewood Iskandar Malaysia Studios, which are expected to be completed by 2012 and 2013 respectively, Edu City, Kota Iskandar and the International Financial District, the company said.
This is Sunway's largest acquisition after the merger of the businesses of two public-listed companies, Sunway Holdings and Sunway City in August which resulted in the merged entity becoming one of the top five property-construction companies listed on Bursa Malaysia.
Sunway also announced a joint venture (JV) with Dayang Bunting Ventures Sdn Bhd, a wholly-owned subsidiary of Khazanah, to formSemerah Cahaya Sdn Bhd. which will principally be involved in conceptualising, managing, implementing and developing the said land.
Sunway currently holds 38% in the JV but will increase its holdings to 60% within 54 months from the date of the lease purchase agreement.
Commenting on the successful acquisition, Sunway founder andchairman Tan Sri Dr Jeffrey Cheah said the acquisition was in line with the company's strategy to continue extending its expertise in building and managing integrated cities, as exemplified in its integrated developments in Bandar Sunway, Sunway City Ipoh, Sunway Velocity and Sunway Damansara.
“We want to replicate this expertise in Johor and develop an iconic development which will capture the local, regional and international market segments as we have done with our integrated developments.
“Together with Khazanah, we are confident that we will be able to successfully establish a strong foothold in the state in the near future,” said Cheah, adding that the project was expected to contribute positively to Sunway's future earnings and cash flow by 2013.
Khazanah managing director Tan Sri Azman Mokhtar said he welcomed Sunway as the latest major Malaysian developer to participate in Iskandar Malaysia.
“Sunway has a proven track record as a successful master developer in Malaysia and this JV is an indication of Khazanah's deepening collaborative partnerships with the private sector. We are confident this joint venture will further boost Medini Iskandar's progress as a catalyst development for Iskandar Malaysia.”
Sunway has established its presence in Iskandar Malaysia through its construction division which is undertaking three major construction jobs in Iskandar Malaysia, including Legoland, Pinewood Iskandar Malaysia Studios and the Central Utilities Facility at the Bio-XCell biotechnology park.
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