Jaks sells PJ property for RM25.87m

PETALING JAYA: Jaks Resources Bhd (JAKS) is selling 1.21ha of freehold industrial land in Taman Perindustrian Sungai Penaga, Petaling Jaya to Hectare Square Sdn Bhd (HSSB) for RM25.87 million cash.
In a filing with Bursa Malaysia, JAKS said it entered into a sale and purchase agreement (SPA) with HSSB for the disposal of the land together with a one-storey factory and will use the proceeds to repay bank borrowings.
"The proposed disposal will enable JAKS Group to unlock capital resources from being tied up as long term assets and realise the value of the property at a fair market value whilst enhancing JAKS Group's liquidity and strengthening its financial position," it said.
The group expects to realise a one-off net gain of RM13.38 million after taking into account the estimated incidental expenses while the EPS is expected to increase from 0.18 sen to 23.07 sen.
The net book value of the property is RM6.88 million as at Dec 31, 2016 while the indicative market valuation is RM26.40 million as appraised on Aug 30, 2016. JAKS' original cost of investment on the property was RM7.31 million as of May 21, 2004.
The board said the sale consideration is fair and reasonable, after considering the small difference between the price tag and market valuation, and that the market valuation was carried out for a different purpose.
The proposed disposal is expected to be completed in the first quarter of 2018.
JAKS share price closed unchanged at RM1.28 with a total of 1.16 million shares traded, giving it a market capitalisation of RM617.28 million.