Oriental Daily, 20 March 2014 - Tropicana RM470.67 Million sold to EcoWorld

Oriental Daily, 20 March 2014

Tropicana sells land to Eco World at RM470 million

(KUALA LUMPUR, 19) Tropicana Corporation Berhad (TROP, 5401) announced that it sold a 308.72 acre land parcel in southern Klang Valley, to Eco World Development Sdn Bhd(ECOWLD, 8206) at the price of RM470.67 million ringgit.

Both companies suspended trading today to make an important announcement. The two companies signed an agreement that is expected to be complete by the second half of the year’s end.

Tropicana representatives said, the 1172-acre land parcel was bought four years ago , now known as Tropicana Aman (previously Tropicana Canal City), with the sales agreement pricing the land at RM35 per square feet, bringing the corporation a profit of RM170mil, this makes the closing share price for the fourth quarter of the financial year ending on 2014, December 31, at 12 cents gain per unit share.

Tropicana Berhad Group Executive Vice Chairman Tan Sri Danny Tan Chee Sing said, “As Tropicana Aman’s chief developer, this transaction will allow co-developers to join us, creating a more vibrant lifestyle-township.

Unlocking land bank asset value

He also pointed out that the sale comes timely with the Group's strategy to accelerate growth and progression, with plans to unlock the value of the Group’s substantial asset base and land bank.

The sale will bring cash income that adds to the group’s capability and its long term gains.

Tropicana Aman sits at the strategic point of Klang Valley’s southern growth corridor, only 40km from the heart of KL city, with surrounding middle-class population catchment like Putra Heights, Kota Kemuning, and also the new township of Rimbayu. Tropicana Aman is expected to be launched in the third quarter of 2014, with a GDV of RM770mil.

Eco World Dato’ Chang Khim Wah said, the purchase was the perfect opportunity for increasing their acquisition of strategic land banks for development.

He said that besides its accessibility, the land parcel has also been approved for development so that construction may begin at once.

Besides, the company believes that it will fulfil the GDV of RM8bil with its mixed residential and commercial phases.

This will be Klang Valley’s first Eco World brand development. Planned to begin construction by the end of year 2014, with 8 years to complete.

Both companies suspended trading for the day, with Tropicana’s shares ending at RM1.43 per share unit, trading a total of RM58.9mil and Eco World recorded an increase of 2 cents, reaching RM4.69 per share with 835,000 shares.

Both corporations resumed trading on Thursday (20 March).