KUALA LUMPUR: Leading manufacturers of rubberwood furniture Sand Nisko Capital Bhd (SNC) has acquired a 25.9 acres of land in Melaka for RM5.8 million to expand its property development business.
SNC's wholly-owned subsidiary Len Cheong Resources Sdn Bhd (LCR) entered into a sale and purchase agreement (SPA) with Cempakaraya Sdn Bhd (CSB) for the land acquisition located in Alor Gajah, Melaka.
SNC managing director Emily Sow Mei Chet said it is a good opportunity for the company to expand the property development business in Melaka through the acquisition of land that is matured and ready for development.
"We have diversified into the property development, construction and property investment business since last year and the latest acquisition could help propel us forward in the property development business," she said in a statement today.
According to Sow, the funding for the acquisition will be done through a combination of internally generated funds and bank borrowings.
The exact mix however will be decided by the management at a later date after taking into consideration of SNC's gearing level, interest costs as well as internal cash requirement for the business operations.
The land acquisition will mark a turnaround for SNC which has seen its furniture manufacturing and trading division struggling amidst the Covid-19 pandemic.
Since last year, SNC has diversified away from the furniture manufacturing and trading division into the construction and property development segment.
LCR has also entered into a joint venture agreement with Goldpeace Corporation Sdn Bhd to jointly develop a parcel of freehold land in Melaka.
The latest acquisition is in line with SNC's efforts to increase its land bank for the purpose of property development.
Led by a team of professionals with vast experience in the property development business, the acquisition is timely as we approach the tail-end of the pandemic.
This latest development would help to escalate the turnaround plans for SNC and expand its construction and property development business.