TRC Synergy's Australian unit sells asset for A$9.66m

PETALING JAYA: TRC Synergy Bhd’s (TRCS) unit in Australia is disposing of a property in Melbourne for A$9.66 million (RM32.16 million) cash.
In a filing with Bursa Malaysia today, TRCS said its wholly-owned subsidiary TRC (Aust) Pty Ltd (TRCA) had on July 14, 2017 entered into a contract of sale of real estate with Forza for the disposal of a landed property identified as Lot S88.
“The disposal will allow TRCA to capitalise the potential value of its landbank. The disposal of the said land is at its current value of AU$9.66 million will generate income and give financial support to TRCA for its imminent development activities in Australia,” it said.
Lot S88 is part of the land known as Lot S9 measuring 6,830 square metres that was acquired by TRCA on Dec 9, 2011 for A$11.5 million (RM36.89 million). Lot S9 was subdivided into two pieces of land on Nov 30, 2016 namely Lot S88 and Lot S89, with two individual titles.
The three single- and double-storey buildings on Lot S88 comprises office accommodation, laboratory and storage on 3,621 square metres of freehold land and are located on Swan Street in Richmond, Victoria.
The original buildings are about 26 years old with new additional section of about 16 years old. The buildings are currently vacant and are due for demolition and redevelopment.
The original cost of the property was RM21.46 million as at Dec 9, 2011 and its net book value is the same.
The A$9.66 million price tag was determined on a competitive tender basis. A valuation on the total site (Lot S9) done in September 2014 by Agents Jones Lang Lasalle placed the value of the land at AU$12.3 million; no valuation was done for Lot S88 alone.
The proposed disposal is expected to result in an estimated net gain on disposal of about RM4.4 million or 1 sen per share.
TRCA plans to use the proceeds for development activities and/or finance payment of bank borrowings, working capital as well as land related expenses.
TRCS’ share price rose 0.7% to close at 72 sen on Friday with a total of 413,700 shares traded, giving it a market capitalisation of RM343.55 million.