LSH Capital plans RM157.6 mln acquisition to expand property, construction businesses

KUALA LUMPUR, March 28 (Bernama) -- Lim Seong Hai Capital Bhd (LSH Capital) has announced a series of corporate proposals with a combined acquisition value of RM157.6 million to expand its property development and strengthen its fast-growing construction business.

The company said the proposed acquisition include the execution of a share sale agreement with Lim Seong Hai Resources Sdn Bhd and several individuals to acquire a 100 per cent stake in Astana Setia Sdn Bhd for RM95 million.

It has also proposed the execution of assets exchange agreement, debt settlement cum share subscription agreement with LSH Ventures Sdn Bhd worth about RM62.6 million, which would be fully satisfied via the issuance of new LSH Capital shares at 45 sen apiece.

“Upon completion of the proposals, the group will have an enlarged secured construction order book amounting to RM1.1 billion in aggregate, with an overall outstanding order book of RM782.0 million.

“The group will also carry a property development project with a gross development value (GDV) of RM1.59 billion, which is expected to provide earnings visibility until 2026,” it said in a statement to Bursa Malaysia today.

According to LSH Capital, Astana Setia has an existing RM395.9 million GDV for its Residensi Laman Segar Hijau (LSH Segar) development project in Taman Segar, Cheras, and the company’s external construction order book stands at RM390.81 million, out of which RM146.82 million is still outstanding.

“Astana Setia’s LSH Segar project has secured 100 per cent uptake under RUMAWIP (Federal Territories Affordable Housing) programme, and 70 per cent uptake among open units,” it said.

On the proposed transaction with LSH Ventures, LSH Capital said that it involved the acquisition of four parcels of land and buildings on-site in attractive locations across Kuala Lumpur, Kajang and Johor Bahru for RM8.14 million.

“In addition, LSH Capital will settle about RM54.5 million owing to the directors of LSH Ventures,” it said.

Upon completion of the proposed transaction, LSH Capital would own 99 per cent in LSH Ventures and would have 93.75 per cent effective interest in Astana Setia & Euro Saga Sdn Bhd, an entity that would launch the upcoming flagship project, Lake Side Homes, on a 4.8-hectare land in Sungai Besi with an estimated GDV of RM1.19 billion.

“LSH Capital will also seek shareholder approval to expand its core businesses to include property and construction-related business as these new integrated upstream businesses are expected to contribute more than 25 per cent of the group’s net profit, moving forward,” it said.

-- BERNAMA