Nanyang Siang Pau, 14 November 2011 - Dijaya, Ivory Rise on Property Tie-up Benefiting Both the Companies and Penang Island

Nanyang Siang Pau, 14 November 2011

Ivory Properties Group Bhd (main property stock, 5175) and Dijacor (main property stock, 5401) is to tie up for property development. This joint-venture will add vibrancy and spur the economic growth of Penang.

During an interview with the The Edge, Financial Times, Ivory Operations Director Murly Manakhanan said, "We chose to joint-venture with Dijaya, as in whatever way, it will benefit both the companies and the Penang Island."

The announcement that Ivory Properties Group Bhd and Dijaya will joint-venture in developing the Penang World City with a gross development value of RM10 billion will also help to lead Penang to become an international city.

The Penang World City is planned to include luxury condominiums, medium-rise condominiums, business suites, services residences, iconic office blocks, commercial and retail spaces, water-front villas, hotel and a water-front entertainment hub.

The development project will be undertaken by joint-venture vehicle Tropicana Ivory Sdn Bhd, which is 49% owned by Dijaya and 51% by Ivory Properties.

Murly said, "According to the joint-venture agreement, Ivory Properties and Dijaya can amend the shares holdings and can, at any time, be the main developer. But since this project was initiated by Ivory Properties, then we will be the main developer."

The whole development project will take approximately five to eight years to complete. Ivory Properties and Dijaya Corp therefore will settle the land price of RM1.07 billion, or RM240 per sq ft, in stages to the Penang Development Corp.

In order to raise RM1.1 billion, Ivory Properties proposed to finance the project via a renounceable rights issue of one to one ordinary shares with free detachable warrants. The company estimated that they will be able to raise RM93 million. Out of this, RM50 million will be utilised to pay the Penang Development Corp. The above also includes payment of bonus issues.

Murly pointed out that they hope to develop the first phase of the luxury high-rise condominiums, and the incomes received will be used to pay for the cost of the land.

He said, "This five-year repayment method will ensure that we have enough liquidity."

Besides, Dijaya Group Chief Executive Officer Tan Sri Dato’ Danny Tan Chee Sing is very optimistic about the joint-venture. He said, “This is a very strategic location, and it will definitely help to contribute a lot the company.”

He said that the whole project will keep the company busy for at least eight years.

Ivory Properties Group Bhd expressed that the joint-venture with Dijaya will further advance the development and will also spur the economic growth of Penang.