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BRDB closer to open tender

May 16th, 2012 · No Comments

PETALING JAYA: Bandar Raya Development Bhd (BRDB) is one step closer to selling off its four prime assets through an open tender, following the company announcement of the appointment of its legal and financial advisers to help out in the deal.

In a filing with Bursa Malaysia, the company confirm it is working with Lee Hishammuddin Allen & Gledhill and CIMB Investment Bank Bhd to help in the proposed disposal.

It said the board had chose to go on with the proposed disposal, at the same time noting that Ambang Sehati Sdn Bhd had so far been incapable to confirm its plans to raise its stake in BRDB.

In September 2011, Ambang Sehati offered to purchase BRDB’s properties, namely Bangsar Shopping Centre, Menara BRDB, CapSquare Retail Centre and Permas Jusco Mall for RM914mil.

The proposal attracted several criticisms from various parties, who conveyed concern over the lack of transparency in the deal and the fairness of the offer price, together with the fact that it was a related-party transaction.

Consequently, the company cancelled the sale and determined to call for an open tender to take into account the interest from reliable parties to get hold of its assets, and also Ambang Sehati’s purpose to raise its stake in the company.

Ambang Sehati is the private investment vehicle of Datuk Mohamed Moiz Jabir Mohamed Ali Moiz, BRDB’s chairman, who owns 18.88% of BRDB.

“The company had decided to proceed with the disposal exercise. Last year, when the news broke (about the four properties), Ambang Sejati wanted to buy (them). At that point in time, Ambang Sejati was thinking of increasing its stake in the Malaysia property company, that is why the board decided to defer the exercise.

“That was 2011, and now Ambang Sejati is still evaluating its options, but the board can no longer wait for them and this (announcement) is a go-ahead with the tender,” said a source familiar to the matter.

He affirmed that the company had not designated a property consultant at present but the legal adviser employed was in the middle of finalizing the proposal on how to go ahead with the tender.

OSK Research said it was suitable for BRDB to monetize its assets provided that the company disposed of them at a fair and attractive pricing.

“As we think Ambang Sehati’s offer price is unattractive, we see the open tender route as positive as this would enable the group to garner better pricing for its assets via competitive bids from other interested parties,” it said.

It said it was very possible that the company would allocate a few of the disposal proceeds as special dividend to its shareholders.


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