KUALA LUMPUR (Sept 7): SkyWorld Development (Vietnam) Company Ltd, a wholly owned subsidiary of SkyWorld Development Bhd, is acquiring 1.3 acres (0.53 hectare) of land in Ho Chi Minh City, Vietnam.

In a filing with Bursa Malaysia on Thursday, the company said it acquired the land by way to purchasing 100% stake or 1.7 million shares of 100,000 Vietnamese dong (RM19.51) each in Thuan Thanh Trading Production and Real Estate Trading Joint Stock Company (the project company) for about 350 billion Vietnamese dong or RM67.9 million.

It has signed a conditional share sale and purchase agreement (SPA) with the project company and its three shareholders, namely Nguyen Son Hai Long, Nguyen Thuy Thoai Phuong, and Nguyen Thuy Diem Phuong.

The project company is the sole and lawful user of a parcel of land located at Ward 16, District 8, and simultaneously, the vendors are in the process of procuring the transfer of land use rights for another two adjourning parcels of land owned by several individuals.

Upon completion of the acquisition, SkyWorld Vietnam will have the lawful land use rights over the properties, including the adjoining parcels of land, through the ownership of the project company.

The project company is currently carrying out relevant legal procedures to register and implement a project comprising a 24-storey apartment building on the land.

Land earmarked for RM310m GDV project

SkyWorld said the land is about 12km from the central business district (CBD) in District 1 and well connected to one of the major arterial roads (Vo Van Kiet Street) linking the west of the city to the CBD.

It said the land is situated within an enclave of established low-rise and high-rise projects, with various local amenities such as schools, hospitals and commercial shops situated within a 3km radius.

“The project is targeted to be priced between 50,000,000 and 70,000,000 Vietnamese dong/m2, where we believe it will have a large captive market and achieve a favourable absorption rate,” said the developer. It added that the project is estimated to have a gross development value (GDV) of RM310.4 milion.

The proposed acquisition will be financed through a combination of internally generated funds, bank borrowings, and/or issuance of Islamic commercial papers and/or Islamic medium-term notes.

“The exact quantum funding mix will be determined later after taking into consideration the SkyWorld group’s gearing level, funding costs, as well as internal cash requirements for its business operations,” said the company.

The purchase consideration includes a deposit of RM20.04 million, due 30 days after the date of the SPA. The first instalment of RM20.4 million is due within four months after the SPA date, with the second instalment of RM27.16 million to be fulfilled within nine months after the payment of the first instalment.