Proposed Disposal of a Piece of Property To Nandex Land Sdn Bhd For A Sale Consideration Of RM20.0 Million
1. INTRODUCTION
The Board of Directors of Ganesha Sdn Bhd (Company No. 49108-K)("Ganesha" or "the Company") a wholly owned subsidiary of Malaysia Building Society Berhad (Company No. 9417 - K) wishes to announce that the Company has entered into a Sale and Purchase Agreement dated 27th July 2007 ("SPA") with Nandex Land Sdn Bhd (Company No. 370318 -T) a wholly owned subsidiary of Meda Inc. Berhad (Company No. 507785 -P) ("Purchaser") for the proposed disposal of the property title no. H.S. (D) 61545, PT 47, Pekan of Tanjong Kling Sek. II, District of Melaka Tengah and State of Melaka for a purchase consideration of RM20,000,000.00 ("Proposed Disposal").
2. THE PROPOSED DISPOSAL
2.1 The Property
The Company is the registered owner of the property known as H.S. (D) 61545, PT 47, Pekan of Tanjong Kling Sek. II, District of Melaka Tengah and State of Melaka measuring approximately 83160 square metres in areas (the "Property").
The Property is a freehold land. Currently, it is a vacant land. Presently, the property is free from any encumbrances.
Messrs Jurunilai Bersekutu had, on 10 May 2006, ascribed an open market value of RM16,700,000.00 to the Property.
2.2 Sale Consideration
The sale consideration of RM20,000,000.00 ("Sale Price") for the Proposed Disposal was arrived at on a willing buyer willing seller basis after taking into account the open market value ascribed to the Property of RM 16,700,000.00.
The net book value of the Property as at 31 December 2006 was RM 19,800,000.00.
2.3 Salient Terms of the SPA
The SPA's salient terms, inter-alia, are as follows:
(i) The Property shall be purchased subject to all existing encumbrances and it shall comply with conditions and restrictions affecting the property and without vacant possession;
(ii) The payment terms are as follows:
(a) A payment of RM1,000,000.00 equivalent to 5% of the Purchase Price was paid upon execution of the SPA as deposit and part payment of the Sale Price (the "Deposit") The purchaser was granted a period of 12 months from the date of the execution of the SPA ("the One Year Period") to obtain planning approval wherein the Company shall grant the Purchaser a Specific Revocable Power of Attorney to facilitate the application for the planning approvals;
(b) The balance of the Sale Price RM19,000,000.00 being 95% of the Sale Price shall be paid to the Company within three (3) months from the expiry of the One Year Period ("Effective Date") which hereinafter known as the ("Completion Period").
(iii) Estimated time frame for completion
The estimated time frame for the completion of the SPA is 15 months from the date of execution of SPA.
(iv) Default by the Purchaser
(a) In the event the Purchaser failing to pay or refusing to complete the Proposed Disposal, the Company shall be entitled to, inter alia terminate the SPA and the sum RM 1,000,000.00 being the Deposit shall be forfeited by the Company and the balance of monies paid by the Purchaser, if any, shall be refunded free of interest to the Purchaser by the Company and neither party to the SPA shall have any further claims against the other in respect of the SPA;
(b) if the Purchaser shall have entered a private caveat, the Purchaser shall withdraw the private caveat and re-deliver vacant possession of the said Land to the Vendor if the same shall have been delivered, and thereafter neither party shall have any claim against the other and the Company shall be at liberty to sell or otherwise deal with the Property in such manner and with such persons as the Company deem fit without tendering or offering the Property to the Purchaser;
(c) the Revocable Power of granted earlier shall automatically be revoked
(v) Default by the Company
(a) If the Company commits a breach of the terms and conditions contained in the SPA or fails to perform and observe all or any of the covenants herein contained compulsory or voluntary; then as an alternative to the Purchaser's right to specific performance, the Purchaser shall be entitled to forthwith terminate the SPA by written notice to the Company;
(b) all monies paid to the Vendor or the Solicitors towards account of the Purchase Price under this Agreement shall forthwith be refunded by the Company in full to the Purchaser free from interest and if the Purchaser shall have entered a private caveat, the Purchaser shall withdraw the private caveat and re-deliver vacant possession of the said Land to the Vendor if the same shall have been delivered;
(c) the SPA shall become null and void and neither party shall have any claim whatsoever against the other save and except for antecedent breach.
2.4 Brief Details On The Purchaser
The Purchaser, Nandex Land Sdn Bhd (370318-T) a wholly owned subsidiary of Meda Inc. Berhad (507785-P), was incorporated in Malaysia under the Companies Act, 1965. Its registered address is 9th Floor, Menara Summit, Persiaran Kewajipan, USJ 1, 47600 UEP Subang Jaya, Selangor Darul Ehsan.
The principal activities of the Purchaser is providing of landscaping services.
3. RATIONALE FOR THE DISPOSAL
The Proposed Disposal is in line with the Company's objective to dispose of properties transferred or acquired through Sale and Purchase Agreement.
4. ORIGINAL DATE OF INVESTMENT AND COST OF INVESTMENT OF THE PROPERTY.
The original date of investment is 8 July 1997 and the cost of investment of the progressive is RM22,853,000.00.
5. CONDITIONS PRECEDENT
The Proposed Disposal is subject to the following conditions:
(i) the Foreign Investment Committee's approval;
(ii) The conditional approval of the Layout Plan/Planning for the proposed development on the Property
from the Appropriate Authorities.
6. UTILISATION OF PROCEEDS
The proceeds of RM20,000,000.00 from the Proposed Disposal would be utilised towards working capital, commission payable relating to the said disposal and/or repayment of borrowings, the breakdown of which has not been decided upon by the Board.
7. METHOD OF VALUATION
The method of valuation of the property is by way of comparison method.
8. NET BOOK VALUE
The net book value of the property is based on audited account.
9. LIABILITIES
The purchaser is not liable to assume any liability on the property.
10. SHAREHOLDERS' APPROVAL
The Proposed Disposals is not subject to any shareholders approval.
11. EFFECTS OF THE PROPOSED DISPOSAL
11.1 Share capital and substantial shareholders' shareholdings structure
The Proposed Disposal will not have any effect on the share capital and substantial shareholders' shareholdings structure as there is no issuance of shares or other securities.
11.2 Earnings
The Proposed Disposal is expected to be completed in 2008 and would result in a no gain no loss (after taking account the commission payable) to the Group for the financial year ending 31 December 2007.
No improvement arising from the Proposed Disposal to the basic earnings per share of the Group for the financial year ending 31 December 2007.
11.3 Net Assets
The Proposed Disposal would not have any material effect on the net assets per share of the Company and of the Group.
11.4 Gearing
The proposed disposal would not have any material effect on the gearing of the Company and of the Group.
12. DIRECTORS AND/OR MAJOR SHAREHOLDERS' INTERESTS OR PERSONS CONNECTED
None of the Directors and/or major shareholders of the Company or persons connected to them have any interest, direct or indirect, in the Proposed Disposal.
13. STATEMENT BY DIRECTORS
The Board of Directors of the Company is of the opinion that the Proposed Disposal is in the best interests of the Company and of the Group.
14. STATEMENT IN RESPECT OF SECURITIES COMMISSION'S POLICIES AND GUIDELINES AND OFFER OF SECURITIES
The Proposed Disposal has not departed from the Securities Commission's Policies and Guidelines and Offer of Securities.
15. DOCUMENTS FOR INSPECTION
The SPA and the valuation report together with the update valuation letter) can be inspected at the Company's registered office at 11th Floor, Wisma MBSB, 48 Jalan Dungun, Damansara Heights, 50470 Kuala Lumpur at normal business hours on Mondays to Fridays (except public holidays) within 14 days from the date of this announcement.
16. This announcement is dated 27th July 2007.
