Floor plan, pricing issues trip Tiger Synergy MoA

PETALING JAYA: Prosma Bhd terminated the memorandum of agreement (MoA) to acquire Telaris Gombak from Tiger Synergy Bhd due to several changes in the project which it did not agree with.

Prosma CEO Zamri Abdullah said under the MoA which was signed earlier in June, the developer had agreed to build 180 units of affordable condominiums sized at 1,000 sq ft each, to be sold at RM400 per square foot (psf) each.

“But during a subsequent meeting, they came out with a letter saying that they cannot change the floor plan due to plot ratio issues and because of that, the units would be sized at 800 sq ft and 900 sq ft, while the price would be increased to RM450 psf,” he told SunBiz.

Zamri said under the MoA, it can opt to not go ahead with the purchase of Telaris Gombak if it is unable to agree on the pricing. He also assured that none of the applicants under Prosma’s rent-to-own (RTO) scheme are affected by the termination, as it had not signed any contracts with applicants for Telaris Gombak units.

On Monday, Tiger Synergy told Bursa Malaysia that it had aborted the MoA with Prosma as it could not reach a consensus on the terms of the MoA during the negotiation period.

To recap, Tiger Synergy’s wholly-owned subsidiary Tiger Synergy Timber Sdn Bhd had entered into the MoA with Prosma on June 29, 2017 with the intention to enter into a conditional sale and purchase agreement (SPA) for the en bloc sale of Telaris Gombak to Prosma.

The en bloc sale was expected to generate some RM30 million profit to Tiger Synergy over three years. The two parties had expected to sign the SPA in September or October.

The project was to be built on 5.5 acres in Kuala Lumpur with an estimated gross development value of RM100 million. The 180 units with eight commercial shoplots were to be developed over three years, after which it would be sold to Prosma.

Prosma, the vehicle tasked to acquire assets for an RTO scheme under Sekretariat Komuniti Prefer Malaysia (SKPM), had planned to offer the units at Telaris Gombak to applicants of its RTO scheme.

The units at Telaris Gombak were valued at RM400,000 to RM500,000 each and designed to cater to young earners. Eligible applicants were expected to rent the units for 30 years under Prosma’s RTO scheme at a rental rate of RM2,000 to RM2,500 per month.

Prosma has a strategic collaboration with SKPM, a community created on the back of a private initiative to assist the government in providing residences to 30% of the population. The RTO scheme is targeted at those who earn RM5,000 and above, offering units valued at RM300,000 to RM500,000 each.

When contacted, Tiger Synergy managing director Shirley Tan Lee Chin maintained that the reason for calling off the deal was because the two parties could not reach a consensus on the terms for the MoA, without elaborating further.