AmProp: Kesas disposal by April

AmProp: Kesas disposal by April
Posted on 13 March 2014 - 05:38am
Liew Jia Teng
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PETALING JAYA: Property developer Amcorp Properties Bhd (AmProp) is expected to conclude the sale of its 20% stake in Kesas Holdings Bhd to Gamuda Bhd by April 2014, after shareholders gave their nod for the deal yesterday, said Amcorp Group Bhd chief financial officer Johnson Yap Choon Seng.

"The deal will be completed the latest in April this year," Yap told reporters at AmProp's EGM here yesterday. He however declined to comment on whether part of the proceeds from the sale will be distributed back to shareholders, in the form of a special dividend.

AmProp will dispose the stake in the highway concessionaire for RM280 million in cash.

"Yes. Like any other AGM or EGM, they (minority shareholders) asked for the dividend," said Yap, without elaborating.

AmProp managing director Lee Keen Pong avoided reporters after the EGM yesterday.

"All I can say is, the shareholders' response was overwhelming and the resolution was passed," said Yap, who is also the company secretary of AmProp, as well as the alternate director to Lee.

On another note, Yap said the board is unsure if the realised gain on the disposal of stakes in Kesas, amounting RM149.1 million, will be reflected in AmProp's financial year ending March 31, 2014 (FY14).

"Maybe there will be impact, maybe not, we are not very sure yet," he said.

To recap, the original cost of investment of AmProp's 20% stake in Kesas was RM94.2 million, incurred since October 1993. The investment has a carrying value of RM130.9 million as at FY13.

According to a circular distributed before the EGM, AmProp will use RM75 million to repay its bank borrowings, which will result in cost savings of RM4 million every year. Its total borrowings amount to about RM383 million.

A large chunk of the proceeds will go to AmProp's committed capital investments, as the company will invest RM104.6 million for its property development projects in London, UK, as well as its renewable energy projects in Pahang.

In addition, AmProp will also spend RM80 million on future capital investments, while the remaining RM20.2 million will be for working capital.

AmProp was the only party which agreed to Gamuda's offer for Kesas. Permodalan Nasional Bhd (PNB) could not agree to execute a definitive agreement with Gamuda, after it agreed to sell its 20% stake to the latter for RM280 million.

Whereas Perbadanan Kemajuan Negeri Selangor (PKNS) did not accept Gamuda's revised offer of RM420 million for its 30% stake.

AmProp's stock closed unchanged at 87 sen yesterday.