BLand to sell Great Mall project for RM1.39 billion

PETALING JAYA: Berjaya Land Bhd (BLand) plans to sell Berjaya (China) Great Mall Recreation Centre (Great Mall project) to Beijing SkyOcean International Holdings Ltd for RMB2.08 billion (RM1.39 billion) cash.
In a filing with Bursa Malaysia yesterday, it said that Berjaya (China) Great Mall Co Ltd (GMOC) has entered into a construction project transfer agreement (contract) with Beijing SkyOcean for the proposed disposal of the Great Mall project, which is under construction and located in Sanhe City, Hebei Province in China.
GMOC is a 51%-owned subsidiary of Berjaya Leisure (Cayman) Limited (BL-Cayman), which in turn is a wholly-owned subsidiary of BLand.
The Great Mall project spans across 306,260 sq m of land, with 1.21 million sq m of gross floor area. The land use rights of the project were granted for a term expiring on Jan 25, 2045 for commercial, entertainment and commercial (car park) uses.
The project will be developed over Phases 1, 1E and 2. Phase 1 is currently under construction while Phases 1E and 2 are vacant.
The cash consideration of RMB2.08 billion represents a premium of 3.07% over the market valuation and a premium of 18.86% over the carrying amount. The cash consideration will be receivable by GMOC over a maximum of two years from the signing of the contract.
The group plans to use about RMB1.11 billion to repay borrowings, creditors, contractors and to defray taxes on sale of the Great Mall project and incidental expenses within 12 months from the respective dates of receipt of the cash portion.
Subject to authority approvals, the cash balance of RMB967.48 million is proposed to be distributed to the shareholders of GMOC, of which BL-Cayman, upon receipt, will utilise the cash for working capital of the BLand group.
The BLand group is expected to record a loss of RMB51.28 million pursuant to the proposed disposal.
The proposed disposal, which is subject to the approvals of the regulatory and/or governmental authorities in China, is expected to be completed by end-2017.