|Update Mah Sing changes plan for RM286m Icon@Mont Kiara project|
|Business & Market 2009|
|Tuesday, 03 November 2009 19:54|
In its announcement to Bursa Malaysia today, Mah Sing however said the termination of the SPA would had no material impact on the net tangible assets and earnings of the company for the financial year ending Dec 31, 2009, as the proposed development of The Icon@Mont Kiara had yet to commence.
Nevertheless, the termination still comes as a lost business opportunity for the company, which now has to change its plans for the project.
To recap, Maxim Heights Sdn Bhd, a wholly-owned subsidiary of Mah Sing, entered into a tripartite SPA on Nov 27, 2007 with Majlis Agama Islam Wilayah Persekutuan (MAIWP) and Prompt Symphony Sdn Bhd for the en bloc sale of The Icon@Mont Kiara to Prompt Symphony for RM285.4 million cash. MAIWP is the owner of the proposed development site.
According to the SPA, the proposed en bloc sale of The Icon@Mont Kiara was conditional upon the procurement of development order by Maxim Heights from the relevant authorities in respect of the project; the procurement of the second bank guarantee by Prompt Symphony; and Prompt Symphony being satisfied with the result of the due diligence of the project.
Mah Sing said Maxim Heights had on Oct 26, 2009 obtained a conditional approval for the development order (conditional DO) from the relevant authorities for the project.
The next day, Maxim Heights notified Prompt Symphony to confirm the due diligence within seven days and/or to deliver the second bank guarantee within 30 days from the date of the notice, failing which, the parties may terminate the SPA by written notice.
"Maxim Heights has, on Nov 2, 2009 received a written notice dated Oct 30, 2009 from Prompt Symphony informing that due to the non-fulfillment of the conditions precedent within the relevant timeframes, the SPA is terminated," said Mah Sing, adding that the parties were now released from all obligations and liabilities arising under the SPA.
The termination of the SPA would not have any impact on Mah Sing’s financials, the company said. Rather, it has come up a fresh concept, reconfiguring The Icon@Mont Kiara project to suit market demand.
Mah Sing said it now intended to develop serviced suites and market the project as "luxury garden terraces in the sky".
The company plans to offer fully or partly furnished serviced suites mostly with built-ups of 850 sq ft and 1,400 sq ft, as well as some units with built-ups of 1,800 sq ft to complement the high rise market that predominantly offers condominiums with larger built-ups. It feels that the new project’s plan will be able to address the pent-up demand for niche size service suites at value pricing.
"This is a niche concept based on a unique architectural façade design highlighting nature and resort-feel living, and we are confident of positive buyers’ response to the product," said Mah Sing.
It added that the location of the project was attractive with new planned commercial developments near the Malaysia External Trade Development Corp (Matrade) headquarters complementing and adding value to the surrounding projects.
The company intends to commence the registration of interest campaign for the new project by end 2009.