News
Proposed Acquisition of Prime Freehold Land Measuring Approximately 351,251 square metres (86.78 acres) in Penang by Mah Sing Group Berhad through its Subsidiary Companies, Vienna View Development Sdn Bhd, Enrich Property Development Sdn Bhd and Vienna Home Sdn Bhd from Kembang Biru Sdn Bhd for a Total Cash Consideration of RM115.75Million or the equivalent of approximately RM30.61 per square foot ("Proposed Acquisition")
Unless otherwise indicated, specified or defined (or re-defined as the case may be) in this announcement, the definitions in our circular to shareholders on the Proposed Acquisition dated 10 October 2007 ("Circular") apply throughout this announcement.
We refer to our announcements on 13 June 2007, 12 September 2007, 21 September 2007, 9 October 2007 and 25 October 2007 in relation to the Proposed Acquisition.
The Board of Directors ("Board") of Mah Sing wishes to announce that further to the sale and purchase agreements ("SPAs") on the Proposed Acquisition dated 13 June 2007, the Purchasers have entered into the respective supplemental agreements ("Supplemental Agreements") with the Vendor for variations, amendments, modifications and alterations of certain terms and conditions of the SPAs.
1.0 Details of the Supplemental Agreements
1.1 The following are the details of variations, amendments, modifications and alterations of the salient terms and conditions of the SPAs as announced under the respective sections in the Circular:
Section 2.10(b) of the Circular: Timing of Payment of Purchase Consideration
There is no amendment in the Purchase Consideration and timing of payment except that the 5th, 6th, and 7th payments totaling RM27,800,000 ("Final Balance of Vendor's Portion") shall be payable by the Purchasers to the Purchasers' solicitors as stakeholders within seven (7) days from the date of fulfillment of the Vendor's obligations pursuant to the Proposed Acquisition.
Section 2.10(c) of the Circular: Conditions Precedent ("CP")
i) Section 2.10(c)(I)(iv) is no longer a CP in respect of Parcels A and C and has been modified/varied and converted into Vendor's obligations, whereas
in respect of Parcel B, the requirement on conversion of land use to "building" remains as a CP while the requirement on approval of layout plan has been modified/varied and converted into Vendor's obligation,
the above modification/variation and conversion are for the purpose of providing timeframe for both the payments to the relevant authorities and to obtain the relevant approvals. As of to date, the conversion of land use to "Building" for Parcel A and Parcel B has been obtained except for land held held under GM 773 Lot 1046;
ii) Section 2.10(c)(II)(i) is no longer a CP and has been converted into Vendor's obligations and modified/varied to provide for further clarification of the terms and conditions in respect of relocation of the existing occupier;
iii) Section 2.10(c)(II)(ii)(a) has been amended as follows but remains as a CP which has been obtained:
"The receipt of a confirmation from the solicitors acting for the Other Undivided Share Owners confirming the location, portion and measurement in area of their part and portion of the land held under GRN 29011 Lot 5784";
iv) Section 2.10(c)(II)(ii)(b) is no longer a CP and has been modified/varied and converted into Vendor's obligations whereby the power of attorney is to be given directly in favour of the Purchaser from the Other Undivided Share Owners; and
v) Section 2.10(c)(II)(ii)(c) has been amended as follows but remains as a CP which has been obtained:
"The Vendor obtaining the consent from caveators under Section 2.5(a) and Section 2.5(c) of the Circular and/or person deriving rights, title, interests and benefits under her, whichever shall be applicable, consenting to the transfer and charge of the Undivided Share and causing the removal of any other encumbrances (except the Existing Charge) affecting the land held under GRN 29011 Lot 5784 as at the date of the fulfillment of the last of all other conditions precedent."
1.2 In addition to the abovementioned Vendor's obligations which are converted from the CPs, the following are the additional Vendor's obligations specifically applicable to land held under GRN 29011 Lot 5784 pursuant to the Supplemental Agreements:
i) the receipt of a confirmation from the beneficial owners of the Other Undivided Share or such evidence acceptable to the Purchasers clearly identifying the location, portion and measurement in area of their respective part and portion of the Other Undivided Share; and
ii) cause the removal of the private caveats entered by the Caveators in the event that the Purchasers wish to apply for subdivision within four (4) months of the Purchaser's receipt of the approval for the Layout Plan, if such removal is required.
2.0 Rationales for the Variations, Amendments, Modifications and Alterations to the Terms and Conditions of the SPAs
In tandem with the growth opportunities and scarcity of land around Batu Maung area where Southbay Penang is located, there are indications that the asking prices for land in the area has appreciated since the execution of the SPAs.
In view of the increased land price and positive outlook of the project, the Purchasers have invoked their rights pursuant to the SPAs to waive/vary the CPs as mentioned above for the purpose of meeting the deadline imposed for settlement of redemption sum to MBSB while ensuring, inter alia, that the CPs waived are converted into obligations to be performed by the Vendor. Settlement of redemption sum to MBSB is essential before the Purchasers are able to proceed with the transfer of title of the respective parcels of land to the Purchasers. The Final Balance of the Vendor's Portion shall only be paid within seven (7) days from the date of fulfillment of Vendor's obligations pursuant to the Proposed Acquisition. As such, both the Vendor and the Purchasers have mutually agreed to execute the Supplemental Agreements.
