GEORGE TOWN: Ivory Properties Group Berhad (IPGB) has obtained shareholder approval for the sale of a plot of land worth RM150 million to another company.
The transaction for the 21.77hectare plot of freehold land in George Town (off Jalan Kebun Bunga) was finalised in January this year between Ivory Indah Sdn Bhd, which is a wholly-owned subsidiary of IPBG and Jesselton Peak Sdn Bhd.
The approval was obtained by way of a poll earlier where IPG's shareholders and proxies voted in favour of the disposal during the extraordinary general meeting (EGM) held at the company’s auditorium at Ivory Tower in Penang Times Square.
Ivory Indah had entered into the sales and purchase agreement with Jesselton Peak on Jan 14 this year for the land in the upscale Jesselton area.
The group said the disposal enabled it to realise and unlock the value of the property which is not generating any income presently.
It also said that the purchase price is at a discounted of about 6.25 per cent as the property is without development approval or approval layout plan from the local authority as at the date of valuation as at June 15, 2015.
The group added that Ivory’s immediate crystallisation of the value of its land bank, through the disposal, will improve its operating cash flow and strengthen its financial standing.
“The proposed utilisation of proceeds of about RM40mil to retire bank borrowings from CIMB will pare down the group’s total borrowings and reduce its gearing level.
“The disposal is also an avenue to generate cash flows to fund general operations and future development projects, to seek other potential investment and facilitate any expansion plan for its current business activities," it added in a statement.
The net gain from the disposal for Ivory is RM38mil which will be recognised upon completion in December 2016 in the financial year ending 31st March 2017.