E&O partners KWAP for property project

PETALING JAYA: Eastern & Oriental Bhd (E&O) has sealed a milestone partnership with Kumpulan Wang Persaraan (Diperbadankan) (KWAP) to jointly develop the Seri Tanjung Pinang Phase 2A (STP2A) project in Penang.
It said in a statement yesterday that its subsidiary Tanjung Pinang Development Sdn Bhd (TPD) has entered into a conditional sale and purchase agreement (SPA) with KWAP to dispose of 20% of the STP2A development land measuring 1.445 million sq ft of net development land to KWAP for RM766.02 million cash.
TPD has also entered into a conditional joint venture (JV) agreement with KWAP to develop the entire STP2A development land via a special purpose vehicle Persada Mentari Sdn Bhd, which will be 80% owned by TPD and 20% owned by KWAP.
“We are deeply honoured to partner KWAP, a highly-valued and reputable institution, in our journey to transform the concept of STP2A into reality. The JV will be on a solid platform to realise the potential of the project and bring it to fruition,” said E&O managing director Kok Tuck Cheong.
He said the proceeds from the proposed transaction will be used to cover reclamation and infrastructure costs, working capital and/or the repayment of borrowings for the project.
“Entering partnership with E&O is an exciting journey and inaugurates our first equity participation into property development for KWAP. E&O’s record of accomplishment in the industry as well as the quality of their delivery will ensure the success of this project,” said KWAP CEO Datuk Wan Kamaruzaman Wan Ahmad.
STP2A is the first phase of the 760-acre Seri Tanjung Pinang Phase 2 reclamation project on the northeast coast of Penang island, for which TPD has been granted the concession rights to reclaim and develop. STP2A has a total gross area of about 250 acres.