PETALING JAYA: Eco World Development Group Bhd (EcoWorld Malaysia) has decided not to pursue the proposed merger with UEM Sunrise Bhd following discussions with UEM Sunrise this month.
The decision comes after careful evaluation by the board alongside EcoWorld Malaysia’s own business plans and the current challenging environment with the reimplementation of the movement control order (MCO).
The proposed merger would have created one of Malaysia’s largest property companies with a projected gross development value of RM173.2 billion and a total landbank of more than 17,000 acres locally.
EcoWorld Malaysia chairman Tan Sri Liew Kee Sin said the cessation of talks on the proposed merger will enable it to actively pursue other corporate proposals that may be more complementary to its present growth plans and strategies.
“It will also enable us to focus on the group’s own business plans for FY2021 which include a sales target of RM2.875 billion for EcoWorld Malaysia that is 25% higher than the actual RM2.3 billion sales recorded in FY2020,“ he said in a statement.
EcoWorld Malaysia has achieved RM500 million sales in the first two months of FY2021, an encouraging result given November and December are typically quiet months for the property sector.
“Team EcoWorld’s ability to lock in these sales demonstrates how effectively they have transformed the overall sales process using every tool available, particularly digital and social media channels, to engage with customers and close sales. We will continue to work on further digitalising and improving every aspect of the sales process during the current MCO to push towards attainment of the overall target set for the year,“ said Liew.
UEM Group had on Oct 2, 2020 proposed to the boards of UEM Sunrise and EcoWorld Malaysia that the two companies consider and deliberate on a potential merger.
It proposed UEM Group as the single largest shareholder of the enlarged UEM Sunrise with a 43% stake, while the substantial shareholders of EcoWorld hold a 24.2% stake. Government-linked investment companies (including that of UEM Group) would hold a collective stake of more than 50%. The board of directors and senior management of the enlarged UEM Sunrise was proposed to be led by a chairman who is an existing board member of UEM Sunrise.
“We are honoured by UEM Group Bhd’s invitation to us to consider the merger and their recognition of EcoWorld Malaysia’s strengths as a potential merger partner. We certainly remain open to the possibility of future collaborations with UEMS, should another opportunity arise,” said Liew.