Wednesday,   8 March 2017

KUALA LUMPUR (March 8): In a move to increase its land bank for property development, ENRA Group Bhd is buying 60 acres of leasehold land in Labuan for RM7.57 million from a government agency. The group’s wholly owned subsidiary ENRA Labuan Sdn Bhd signed the deal with Labuan Corporation today, with a call option to purchase an additional 140 acres. “The purchase price for the second parcel shall be the market value of the parcel at the time the call option is exercised by ENRA Labuan, plus a premium of 20%,” ENRA said in a stock exchange filing. Both parcels of land are located at the waterfront industrial zone of the island’s Kampung Rancha-Rancha and have yet to be reclaimed. ENRA said the first parcel is strategically located adjacent to the Rancha-Rancha Industrial Estate and will benefit from the federal government’s plans to transform Labuan into a premier tourist destination and low cost carrier hub for East Asia.

“The recently reported federal government approval of RM170 million for the construction of a coastal road project in Labuan will also improve Labuan’s connectivity, and pave the way for new commercial and tourism development in surrounding areas,” it added. ENRA said the acquisition of the first parcel will be satisfied wholly in cash and will be funded through a combination of internally-generated funds and borrowings. Meanwhile, the call option for the second parcel is exercisable over a period of 36 month from the completed acquisition date of the first parcel. The group does not expect the acquisition to have any material effect on the earnings per share, net assets per share and gearing for its financial year ending March 31, 2017. The acquisition is conditional upon approval from the land registry, consent from appropriate authorities, completion of due diligences required by ENRA Labuan, and shareholder approval for the purchase of the first parcel, with the conditions to be fulfilled on or before the expiry of nine months after the date of the agreement, ENRA said. ENRA’s share price closed down 5 sen or 1.92% at RM2.56 today, in thin volume of 500 units. The property developer and oil & gas player had a market capitalisation of RM352.14 million.

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