We refer to the announcement dated 29 August 2023 (“Announcement”).
The abbreviations and terms referred to, in the Announcement is applied and shall have the same meaning in this announcement.
The Board of Directors of ICB wishes to confirm that the Joint-Venture is tantamount to a disposal of development rights as defined under Para 10.02(1) of Bursa Malaysia Main Market Listing Requirements. Nevertheless, as the highest percentage is calculated at only 20.12%, ICB is not required to seek shareholders' approval for the transaction.
The obligations of both RVSB and EPSB are as follows:
Obligations of RVSB
The obligations of RVSB are as follows:-
i. RVSB agreed to grant EPSB, an irrevocable Power of Attorney inter alia, to facilitate the submission of the Application to extend the Initial Development Order and/or the New Development Order, the submission of the Approvals, the execution of the sale and purchase agreement of the strata units, the submission of the application for subdivision of individual lots and issuance of strata titles, the transfer of the individual lots to the respective purchasers, the submission for financing or funding wherein RVSB expressly agreed that EPSB is entitled to charge and encumber the Lands for the sole purposes of financing or funding for or in connection with the Development and not for any other purposes not relevant to the Development. The Power of Attorney shall be executed by RVSB within fourteen (14) days from the date of the JV.
ii. If so requested by EPSB, RVSB shall facilitate the EPSB’s applications to the relevant government authorities for Approvals and sign all applications, plans, elevations, specifications, drawings, or any other relevant plans or documents in connection thereof within a period of fourteen (14) days whenever called upon to do so by EPSB provided always that EPSB shall ensure all its applications, plans, elevations, specifications, drawings and documents are in order and in compliance with the relevant statutes regulation by law or order governing such matters;
iii. Save for the RVSB’s Units, RVSB shall consent to the sale or sub-sale by EPSB of any and all the other individual lots in the Development on the Land upon terms and conditions and for such consideration as EPSB shall deem reasonable and the RVSB shall execute of such agreement or agreements transfer or transfers in relation thereto whenever called upon by EPSB and shall comply with all rules regulations by-laws statutes and Acts of Parliament for the time being in force pertaining to the sale of any such individual lots;
iv. Upon execution of the JV, until the sale of all the individual lots in the Development by EPSB, RVSB expressly agreed that in the event RVSB wishes to sell any of RVSB’s Units, RVSB agreed not to sell RVSB’s Units below the selling price fixed by EPSB;
v. RVSB hereby warrants that there are no outstanding claims, demands or liabilities of any kind whatsoever whether arising by statute or otherwise in respect of the Lands at the date of the JV and that all charges, premiums, and dues payable to the government, authorities, statutory bodies or statutory corporations have been fully paid;
vi. Upon execution of the JV, until completion of the Development, RVSB shall not encumber, sell or deal with the Land so as to defeat the purpose of this Agreement and/or cause loss or damage to EPSB by any breach of the covenants, terms and conditions herein contained or in any manner to do or caused to be done any act or omission in derogation of the general spirit of the JV;
vii. RVSB also warrants that no agreement, arrangement, or dealing whatsoever nature had been entered into between RVSB and any third-party vis-a-vis the Land that will affect the priority, validity and enforceability of the JV or the rights of EPSB;
viii. RVSB warrants that RVSB is not in any manner incapacitated, whether by their constitutions, the laws of Malaysia or otherwise, to enter into the JV and will not in any manner be invalidated or nullified on any ground whatsoever;
ix. RVSB hereby acknowledges and confirms that EPSB shall be entitled to the sole and exclusive right to develop and occupy the Land without any interference by RVSB, to undertake and complete the Development, to carry out and construct the individual lots and all the infrastructure and to sell the individual lots subject to the terms and conditions herein contained; and
x. RVSB undertakes not to interfere on the Development, including matters relating to the development concept, the pricing, marketing and construction.
Obligations of EPSB
The roles and responsibilities of EPSB are as follows:
xi. EPSB shall use its best endeavour to procure an extension of the validity of the Initial Development Order and/or to obtain a new development approval, building plan approval and all other relevant approvals from the relevant authorities as required under all such relevant laws, regulations, statutes and by-laws before commencing the Development;
xii. In carrying out the Development, EPSB shall observe all relevant laws, regulations, statutes and by-laws by the relevant authorities whether present or in the future;
xiii. EPSB shall make good at its own expense or indemnify RVSB against damage to any properties whether public or private adjoining the Land if such damage is occasioned through any act or omission of EPSB, its employees, agents or contractors;
xiv. EPSB shall not create or permit to be created any form of nuisance in any manner on any public roads or any building or structure whether public or private in the course of carrying out the Development and shall indemnify RVSB against all penalties in respect of such breaches;
xv. EPSB shall pay to the relevant parties or authorities all quit rent, rates, claims, outgoings and other expenses required for the Development;
xvi. EPSB shall undertake all construction expenses and pay all costs for the Development chargeable or imposed by the relevant local or Government authorities by statute or otherwise in respect of the Development at any time after the date of the JV to the date of handing over vacant possession of all the units in the Development to all the respective purchasers (including RVSB);
xvii. EPSB shall obtain all permission permit and consent required and shall comply in all respect with the statutory instruments rules orders and regulations whether now or in future in force relating to planning control and with any other directions or notices made or given thereunder and in particular with the conditions imposed in the approval for the Development and also by any other Acts, by-laws rules and regulations affecting the same and shall do all such works and things as shall be lawfully required;
xviii. EPSB shall charge and encumber the Land to EPSB’s Financier for the sole purposes of financing or funding for or in connection with the Development and not for any other purposes not relevant to the Development;
xix. In this connection, EPSB shall ensure that the EPSB’s Financier shall disburse the Loan to redeem the Land from the Existing Chargee;
xx. EPSB shall use its best endeavour to ensure that the Development follows as closely as possible with the development concept agreed upon by RVSB subjected to such changes, variation, amendments, restrictions and prohibitions as stipulated and required by the relevant authorities and/or as deemed necessary and appropriate by EPSB upon discussion with RVSB;
xxi. EPSB shall apply and procure the subdivision of the Land into strata units for each of the units in the Development and the issuance of the strata titles to such individual lots, in which event EPSB shall pay to the relevant parties or authorities all rates, claims, outgoings and other expenses required to procure the issuance of the strata titles;
xxii. EPSB hereby agree not to allow any purchasers to enter into occupation at the Development until the issuance of the Certificate of Completion and Compliance by the relevant authorities;
xxiii. EPSB shall use its best endeavour to procure end-financing facilities from various bank or financial institutions to any intended purchasers who are qualified for such facilities and who may require loans for such purchases and RVSB agrees with EPSB that pending the issuance of the individual titles to the respective individual lots in the Development, it shall, if required, consent to any assignment for the purposes of securing the purchasers’ loan subject to the fulfilment of EPSB’s terms and conditions of the JV;
xxiv. EPSB shall be responsible for all matters pertaining to the sale administration and financial aspects of the Development. All sales proceeds shall be received by EPSB. In this respect EPSB shall have the sole discretion to appoint and engage sales agent or representative or personnel to sell and market the units in the Development. All matters and/or decisions pertaining to marketing financing and administration of the Development shall be at the sole discretion and authority of EPSB;
xxv. EPSB hereby undertakes and covenants that to complete the Development within time and manner as provided no later than six (6) years from the date of the JV (hereinafter referred to as “Completion Period”) subjected to an extension of one (1) year from the expiry of the Completion Period or such further extended period as the parties herein may mutually agree upon. Notwithstanding the same, should the New Development Order and/or the relevant authorities required an earlier completion date, the EPSB hereby undertakes to comply with the same;
xxvi. EPSB shall carry out and complete and/or use its best endeavour to ensure that its agents, contractors and/or employees to carry out and complete the Development without unreasonable delay to the reasonable satisfaction of the relevant authorities, architects and/or engineers appointed herein and shall confirm with the direction and requirement of the Approvals and or other conditions and specifications imposed in the Approvals; and
xxvii. EPSB shall at liberty and with sole discretion decides on the concept, materials, method and manner of construction of the Development.
The Board also wishes to inform that RVSB shall be entitled to 30% of the Nett Development Value, being a negotiated percentage for a reasonable return to the Company taking into account its original cost of the Land and corresponding land development expenditure incurred. Both parties have also agreed that a minimum amount of profit guarantee (“PG”) by EPSB minus the First Payment, of Ringgit Malaysia Twenty Million (RM20,000,000.00) consisting of the cash payment and the residential units payable to RVSB in the following manner:
(a) the First Payment is payable by EPSB to the Existing Chargee to redeem the Land upon the Unconditional Date which shall be refunded free of interests to EPSB within fourteen (14) days upon non-fulfilment of the Conditions Precedent.
(b) the monthly payment of Ringgit Malaysia One Hundred Thousand (RM100,000.00) payable to RVSB on the seventh day of the fourth month from fulfilment of Conditions Precedent and thereafter on the same date of each succeeding month up till the issuance of the CCC;
(c) the quarterly payment of Ringgit Malaysia One Million (RM1,000,000.00) payable to RVSB on the seventh day of the fifteenth month from fulfilment of Conditions Precedent and thereafter on the same succeeding date every three months up till the issuance of the CCC;
(d) the Final Payment payable to RVSB within fourteen (14) days upon release of all sums in EPSB’s HDA; and
(e) the first RVSB’s Units shall consist of the number of units mutually agreed upon by the parties within one (1) month from the Unconditional Date, wherein an agreement to contra the first RVSB’s Units shall be entered into between EPSB and RVSB within one (1) month upon issuance of the Advertising Permit and Developer’s License (“APDL”).
The estimation of the PG of RM20.0 million is derived from the valuation of the land of RM16.0 million (“As is” basis) taking into account an expected return of 25% from the Development. The Board, having been appraised, agrees to the terms of the JV and of the view that the PG is realistic.
In the event, the total sales for the Development is below 90% upon issuance of the CCC, both RVSB and EPSB hereby agree that RVSB shall be entitled to the additional RVSB’s Units which shall consist of the number of units mutually agreed upon by the parties within fourteen (14) days from the issuance of the CCC, wherein an agreement to contra these RVSB’s Units shall be entered into between EPSB and RVSB within one (1) month upon issuance of the CCC.
Information on the Land
The freehold vacant land, purchased on 14 March 2000, was held under Geran No. 339676, Lot 53362 Seksyen 10, Bandar Kajang, District of Ulu Langat, State of Selangor, measuring approximately 16,571 meter square in area. The proposed development on this freehold vacant land is a mixed development known as Serika Kajang.
IM Global Property Consultant Sdn Bhd conducted a market valuation on 25 August 2020 using an “As Is” and “On Assumption” basis which indicates a value of RM16,000,000 and RM21,000,000, respectively.
The valuation applies an “On Assumption” basis where the nett land area of the Land is 14,794 m², approximately 159,241 sq. ft. or 3.656 acres, as per the pre-computation plan bearing reference no. MPKJ.JPP/BPB/KM/67-2016(PH) dated 25 October 2016. The Land was issued with ‘building’ title for commercial use, premium paid and ready for immediate construction.
The current net book value of the Land based on the latest audited financial statements of RVSB as at 30 June 2022 was RM15,614,710. This amount represents RVSB’s financial commitment for the Development and the JV. The Land is currently charged to OSK Capital Sdn Bhd [Company No.: 385309-U] [Presentation No.: 50945/2018] dated 7 June 2018.
Information on the Development
Serika Kajang Project will consist of 22 & 23 storey tower of contemporary apartments which comprises 661 units of service apartments, 48 units of retail and 114 units of office space. The Project is expected to generate a Gross Development Value (“GDV”) of approximately RM310.0 million with estimated Gross Development Costs (“GDC”) of RM220.0 million giving rise to an estimated Development Profit of RM90.0 million.
The Development is expected to commence towards the end of 2023, upon fulfillment of the Conditions Precedent and to be completed no later than six (6) years from the date of the JV.
In terms of funding, EPSB shall charge and encumber the Land to the EPSB’s Financier for the sole purposes of financing or funding for or in connection with the Development and not for any other purposes not relevant to the Development.
RVSB had obtained an initial Development Order [File No.: MPKj.JPP/BPB/KM1/61-2014]. The JV will permit EPSB to use its best endeavour to procure an extension of the validity of the Initial Development Order and/or to obtain a new development approval, building plan approval and all other relevant approvals from the relevant authorities as required under all such relevant laws, regulations, statutes and by-laws before commencing the Development.
Information on Elay Project Sdn Bhd (“EPSB”)
The Directors for EPSB are Yao Lei, Liew Heng Siong and Low Git Haw. The shareholders are Yao Lei (2,850,000 shares), Chang Yew Kuan (1,650,000 shares) and He Xiaolu (500,000 shares).
EPSB is driven by the following Key Personnel with excellent Project Development experience:
Chief Executive Officer:
Liew Heng Siong (Thomas), an Interior Designer by profession is also a partner of Dwitasik Project Development Sdn Bhd, a leading development & construction & interior fit-out works in Kuala Lumpur. His involvement in property development expanded to 14 years in construction and 32 years in interior fit-out works.
Among the development handles by Mr Thomas are:
- Bandar Sri Permaisuri Residential, Parcels G1 Villa Laman Tasik,
- Development at Bandar Sri Permaisuri - Commercial Parcels Q Phase 1 & Parcel J Condominium 3 Block and External Client for Construction Works,
- Setia Precast Sdn Bhd (SP Setia) for 2 blocks of 10 storey and 1 block of 6 storey height consisting of 160 units of staff quarters at Jalan Setia Murni, Shah Alam, Selangor,
- Vacaron Company Sdn Bhd Sales Gallery at Lot 35, Jalan University, Section 13, Petaling Jaya, Selangor,
- Bandar Eco Park for Commercial development, consisting 4 units of retail space 1-2 floor roof top car park, 1 unit TNB substation at the ground floor, 1 unit refuse chamber at the ground floor, 1 units prayer room at level 1, covered walkway at Setia Eco Park, Seksyen U13, Shah Alam, Selangor for Bandar Eco Setia Sdn Bhd,
- LRT 3 Package GS07-08 For Light Rail Transit Line 3 From Bandar Utama Johan Setia, Klang, Selangor,
- Interior Fit-out Works - Cadangan Kompleks Institut Penyelidikan Kesihatan Bersepadu (IPKB) for Kementerian Kesihatan Malaysia at Setia Alam, Selangor,
- MVS North Point Hotel works package No SKM 34903, interior fit-out works for Ensigna Construction Sdn Bhd, and
- MVS North & South Tower package SKM 38701, Ceiling works to passenger, lift lobby common corridor and back of house for Ensigna Construction Sdn Bhd.
Project Director:
Low Git Haw (David), a result driven, teamwork oriented and passionate team leader to develop and strengthen management teams which maximize company profitability and efficiency. 23 years’ experience in landed, strata and individual title housing development, building construction and property management. Profoundly of proven excellent interpersonal and communication skills in establishing sustainable relationships in all-embracingly.
He was involved in the following projects:
- Setia Eco Park Phase 8E, 43 units Semi-detached houses,
- Setia Eco Park Phase 12A, 53 units Bungalow houses,
- Setia Eco Park Phase 16A, 90 units Semi-detached houses,
- Setia Eco Park Phase 17, 52 units Semi-detached houses,
- Setia Eco Park Phase 12B,12C1, 12C2 & 16C 143 units Semi-detached houses, and
- Setia Eco Park Phase Arundina, 192 units Semi-detached houses
Chief Marketing Officer:
Mr. Yao Lei (Frank) has expertise in the technical, conceptual and content development of sales-driving collateral. Proven ability to drive record-high marketing campaign response rates and execute successful product launches.
Mr Frank has 14 years of experience in marketing industry. He is a respected leader of creative teams, multimedia divisions and corporate communications departments. Conceptualize and orchestrate marketing campaigns that effectively reinforce and build brand images.
Further announcements will be made upon any material developments in regards to this matter, in accordance with Main Market Listing Requirements of Bursa Malaysia Securities Berhad.
This announcement is dated 4 September 2023.
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