Global Oriental Bhd expects to record net gain of RM85.22mil from the sale of 15.56 acres of land in Seri Kembangan, Selangor to a Singapore incorporated Qingdao Investment Pte Ltd.
Global Oriental said on Tuesday its unit is selling the two parcels of leasehold land to Summit View Development Sdn Bhd, a unit of Beverly Group Sdn Bhd, which is a wholly-owned subsidiary of Qingdao Investment.
“The proposed disposal represents a good opportunity for Global Oriental to crystalise capital appreciation of the lands for cash,” it said, adding the proceeds would be used to pare down its borrowings and carrying projects.
Global Oriental said based on the current conditionally approved development order dated Sept 29, 2014 for a portion of the land and planned potential future development, the estimated gross development value for the lands was RM740mil whilst the estimated gross development costs for the lands was RM557mil.
“The estimated gross development profit to be derived therefore amounts to RM183mil. The land was acquired as part of the a larger piece of land in 1994 and has an apportioned cost of RM6,741.
“In 2003, the land was revalued to RM14.31mil. The carrying value of the land and its related development expenditure as reported in the latest audited financial statements of Global Oriental group for FY ended March 31, 2014 was RM24.55mil,” it said.
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