E&O Unit To Sell London Land For RM427.8 Mln

KUALA LUMPUR, Aug 20 (Bernama) -- Eastern & Oriental Bhd’s (E&O) indirect wholly-owned subsidiary, Hammersmith Properties Ltd, has proposed to dispose of two freehold land parcels in Hammersmith, London, to Varsity Capital 1 Propco Ltd for a minimum cash consideration of £75 million or RM427.8 million (£1 = RM5.7040).

In a filing with Bursa Malaysia today, E&O said the proceeds from the proposed disposal will be used for potential property development and investment opportunities or, alternatively, to repay the group’s existing borrowings.

The company said it also plans to allocate about RM221.8 million (net of estimated expenses) from the disposal proceeds to expand its property development or investment business, which may include acquisition of landbank, joint ventures and development rights. 

According to E&O, the proceeds from the disposal, which will be executed through a sale and purchase agreement, are expected to be fully utilised within three years of completion.

It added that the transaction is expected to result in a net gain of about RM239.3 million after taking into account the reversal of impairment losses of RM248.3 million and estimated disposal expenses of RM6 million in the financial year when the deal is completed.

-- BERNAMA