LBS takes over Lamdeal for US$1 (RM3.21) only

by **Cals** Thu 03 Oct 2013, 09:03

Published: Thursday October 3, 2013 MYT 12:00:00 AM
Updated: Thursday October 3, 2013 MYT 8:20:45 AM
LBS takes over Lamdeal for US$1 (RM3.21) only
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The Zhuhai International Circuit, operated by LBS Bina Bhd, a Malaysian Company listed on the main board of the Bursa Malaysia

PETALING JAYA: LBS Bina Group Bhd has acquired the entire equity interest inLamdeal Investment Ltd, via subsidiary Dragon Hill Corp Ltd, for US$1 (RM3.21) only.
It said it exercised its rights under the Option Agreement and Supple-mentary Option Agreement dated April 8, 2004 and March 20, 2006 respectively to acquire Lamdeal.
Lamdeal is an investment party to a racing circuit project where it, together with its joint-venture partner in China, had formed a Sino-foreign cooperative joint-venture entity in 1992, known as Zhuhai International Circuit Ltd (ZICL) to jointly develop and operate China’s first professional racing track, the 264-acre Zhuhai International Circuit (ZIC). ZICL is a 60%-owned subsidiary of Lamdeal.
The group also announced to Bursa Malaysia that the management agreement dated April 8, 2004 between Dragon Hill and Lamdeal, which was no longer required, had been terminated.
ZIC is located next to the Lakewood Golf Club and a 197-acre land earmarked for mixed development.
The group noted its investments in the club and the development land were sold recently for HK$1.65bil.
“LBS believes in the potential of the ZIC land. This acquisition is timely as the group believes that it will benefit in the long term given the shortage of sizeable prime land in Zhuhai,” managing director Datuk Lim Hock San said in a press statement.
“The decision to bring back ZIC into the group will maintain the group’s presence in Zhuhai, China and may in the future provide another opportunity for the group’s venture into property development,” he added.
LBS said the exercise price at US$1 would create a negative goodwill (non-operating profit) of RM2.65mil, thus would be giving an increase in the profit after non-controlling interest of the group for the financial year ending Dec 31, 2013 (FY13) by 7.12% as compared with LBS’ audited financial statements for the year ended 2012.
Neither the exercise of option nor the termination of management agreement would have material impact on net asset, earnings and gearing of the group for FY13.
LBS had in 2002 derived a safety plan to dispose of Lamdeal to a third party with an option to repurchase it back at US$1.