PETALING JAYA: Tropicana Corp Bhd is selling 128ha near Kota Kemuning, Selangor to Eco World Development Group Bhd for RM470.67mil cash.
The land is part of the 474ha Tropicana Aman (previously known as Canal City land) which Tropicana acquired from the Selangor state government in April 2013.
The sale and purchase agreement is targeted for completion by the second half of 2014, and is expected to generate a net gain of about RM170mil for the group.
Tropicana said the sale would enhance its net earnings per share by 12 sen for the financial year ending Dec 31.
Group executive vice-chairman Tan Sri Danny Tan Chee Sing said: “As the master developer of Tropicana Aman, this transaction is significant in enabling us to bring in a developer who can complement our development approach in creating vibrant and unique self-contained communities.”
He added that the sale was in line with the company’s transformation strategy to unlock the value of its sizeable landbank as well as to strengthen its balance sheet.
Based on the net gain of RM170mil or RM12.64 per sq ft, Tropicana’s cost for the parcel was RM22.36 per sq ft, which translates into a profit of 56.5%.
Tan also said that Tropicana Aman was slated for launch in the second half of 2014.
“The scheduled launches of Tropicana Aman this year will comprise landed properties with an estimated gross development value (GDV) of RM770mil,” Tan added.
For EcoWorld, the 127.93ha will be developed into its maiden township in the Klang Valley, known as EcoSantuary, with a GDV of RM8bil.
EcoWorld president and CEO Datuk Chang Khim Wah said the acquisition was a good opportunity for it to replenish its landbank in major growth areas.
Besides the strategic location, the land, which was bought on a net land basis, came with an approved development order.
“This will enable the group to launch the project shortly after completion of acquisition,” EcoWorld said in a statement, adding that the project would commence by end-2014 and last for eights years.
EcoWorld plans an eco-themed mixed residential and commercial development for the parcel. The deal is also EcoWorld’s first land acquisition as a listed entity. Tropicana bought the 474.29ha at Tropicana Aman, or previously known as Canal City, from the Selangor government for RM1.3bil or RM25 per sq ft last April.