DRB-Hicom exits hospitality business, swaps land with Syed Mokhtar firm in RM1.9b deal

PETALING JAYA: DRB-Hicom Bhd is disposing of a large portion of its non-industrial property assets and its entire hospitality portfolio to Tan Sri Syed Mokhtar Al-Bukhary’s privately held company, in a deal estimated to be worth RM1.9 billion.

In a filing with Bursa today, the group said it will dispose of several subsidiaries owning some 2,200 acres of land as well as its entire equity in Horsedale Development Bhd and Rebak Island Marina Bhd to Prisma Dimensi Sdn Bhd.

The transaction will be satisfied via a cache of landbank in Johor totalling 1,243.45 acres belonging to Prisma Dimensi and Kelana Ventures Sdn Bhd, and a cash payment of RM289 million.

The sale of the companies and the land, which is subject to regulatory and governmental approvals, is expected to net DRB-Hicom a one-time gain of RM849 million.

Upon completion of the deal, the group’s industrial landbank will increase to 1,800 acres. It currently has 600 acres of industrial landbank in Kedah, Perak and , some of it already under development as industrial parks. This includes the recently launched National Automotive Cluster @ Proton City in Tanjung Malim, Perak.

The group said in a statement yesterday the disposal is part of its strategy to take advantage of its 30-year experience in the development of industrial properties.

“With the incoming landbank in Johor, the group is in an advantageous position to tap into the high demand of industrial parks, especially from , and DRB-Hicom intends to develop this into a high-tech and modern industrial park once the property market recovers from its current slumber,” said group managing director Datuk Seri Syed Faisal Albar.

In its exit from the hospitality industry, the group will sell Rebak Island Marina, the owners of Vivanta Rebak Island Resort by Taj located on Rebak Island, Langkawi, Holiday Inn Glenmarie and Glenmarie Golf & Country Club, both located in Shah Alam. The Lake Kenyir Resort Taman Negara in , which was closed in 2016, is also part of the asset disposal.

“Having a core focus for each of our main sectors is important. While there is potential of course in the hospitality industry, we feel that DRB-Hicom’s strengths lie in different areas. This exit will allow us to have a leaner and more focused properties portfolio, making it easier to harness these strengths and push towards excellence in industrial property development,” said Syed Faisal.

The group expects the transaction to be completed within the first quarter of 2019, subject to obtaining all regulatory approvals.

On Bursa Malaysia today, DRB-Hicom rose 0.43% or 1 sen to RM2.33 with 8.43 million shares traded.

Source: The Sun Daily

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