BY TOH KAR INN
KUALA LUMPUR: Property development company Titijaya Land Bhd’s wholly-owned subsidiary Titijaya Resources Sdn Bhd has today signed a shareholders agreement with CREC Development (M) Sdn Bhd for the construction and development of a leasehold land at Embassy Row, Jalan Ampang.
The proposed development to be built on the land measuring 6.06 acres, is expected to have a gross development value of RM2.1bil.
Concurrently, both companies have also acquired Ampang Avenue Development Sdn Bhd for a total purchase consideration of RM80mil.
Ampang Avenue, whose subsidiary is the registered proprietor of the land, now functions as the joint venture (JV) company.
The plot of land has a current market value of RM403mil and has an approval from Dewan Bandaraya Kuala Lumpur for a mixed use development with a plot ratio of 1:8:0.
In the JV company, Titijaya will be responsible for matters related to sales, marketing, credit management and administration, while CREC will take lead for matters related to monitoring, management and supervision of the day-to-day construction operations.
Both companies will appoint a nominee company of CREC as the main contractor of the JV company for the proposed development project.
Titijaya group managing director Tan Sri Lim Soon Peng said that the signing marks an important milestone for Titijaya, in its efforts to broaden its revenue stream.
“The rationale of the proposed acquisition of Ampang Avenue is for Titijaya Resources together with CREC as shareholders of the JV company to form a strategic collaboration in relation to the proposed development of the land.
“We believe that this corporate exercise will enable us to seek new strategic growth and ensure earnings sustainability for Titijaya, moving forward,” said Lim.
He added that the proposed JV with CREC will enable both parties to leverage on the synergistic outcomes, for mutual benefits.
CREC Development is a wholly-owned subsidiary of China Railway Engineering Corporation (M) Sdn Bhd, which is in turn a wholly-owned subsidiary of China Railway Group Ltd.
CREC is one of the world’s largest construction companies, with a history of more than 100 years and ranked 57th among Fortune World Top 500 Enterprises and 7th among Top 500 Chinese Enterprises in 2016.
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