SHAREHOLDERS of YNH Property Bhd (YNH) have given green light to the disposal of Kiara 163 Retail Park and AEON Seri Manjung for a total of RM422.5 mil cash to ALX Asset Bhd at the company’s extraordinary general meeting (EGM) held today.
“We are appreciative of the trust and confidence our shareholders have placed in YNH and our strategic initiative to unlock the value of these two assets,” commented YNH’s independent non-executive director Ching Nye Mi of the disposal exercise.
“It will generate an infusion of RM422.5 mil into the YNH group and this will strengthen our balance sheet while allowing our group to gain more headroom to secure future funding required to finance other exciting projects within our landbank as well as kick-starting our flagship project, Menara YNH.”
According to Ching, YNH remains optimistic on Malaysia’s property sector outlook with the group expecting to continue to receive rental income circa RM6.4 mil per annum from its current properties located in Perak.
“Our on-going property development projects including Solasta Dutamas and future property development project located in Genting Highlands are also expected to contribute positively to our group’s financial performance in the foreseeable future,” he added.
According to the circular to shareholders dated Feb 10, the YNH group is expected to record a pro forma net gain of approximately RM61.0 mil from the proposed disposal exercise which is expected to improve its net assets and earnings.
Proceeds of the disposal will be utilised for repayment of bank borrowings and working capital requirements of the group as well as to pay for the said proposed disposal exercise.
YNH had earlier disclosed that the total cash consideration of RM422.5 mil consists of the disposal of Kiara 163 Retail Park for RM270.50 mil and AEON Seri Manjung for RM152.0 mil.
Both assets will be satisfied by ALX Asset Bhd entirely in cash through the issuance of medium-term notes (MTNs) under a proposed asset-backed medium-term-notes (ABS MTN) programme of up to RM500 mil in nominal value.
YNH has also disclosed in its circular to shareholders that the proposed disposal is a related party transaction (RPT), hence its chairman Datuk Dr Yu Kuan Chon as well as its managing director Datuk Yu Kuan Huat have abstained from all board deliberations, meetings and on voting on the resolutions pertaining to the proposed disposal at the recently concluded EGM.
At the close of today’s trading, YNH was unchanged at RM4.70 with 15,900 shares traded, thus valuing the company at RM2.49 bil. – March 1, 2023
