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PROPERTY developer Talam Corp Bhd is believed to be divesting its land
bank in Selangor and Kuala Lumpur, and a four-star hotel in China, to
raise as much as RM400mil to pare down borrowings.
Sources said the property developer had concluded deals to sell two plots of land in Selangor for RM113mil cash.
IJM Corp Bhd bought one piece of land valued at RM33mil in Puchong
while another plot was sold to a 50:50 joint venture (JV) between Talam
and IJM’s property division, IJM Properties Sdn Bhd.
Sources said the JV was formed to develop a high-end landed property project on the prime land in Ulu Klang near Ukay Heights.
On Monday, Talam announced to Bursa Malaysia that its subsidiary,
Terang Tanah Sdn Bhd, had revoked an earlier JV agreement with Star
Base Sdn Bhd to develop the 35.6 acres leasehold land in Ulu Klang.
StarBiz understands that the agreement was terminated to make way for IJM Properties to be the main contractor for the project.
Sources said the partnership would enable Talam, which specialises in
medium and low-cost properties, to tap on IJM group’s brand name to
capture the high-end market, adding that IJM Properties would benefit
as the main contractor and it did not have to fork out big sums to buy
such prime land for development.
One source said selling the prime land and jointly developing it was a
wise move for Talam, given that the group did not have a niche in the
luxury property market.
On the sale of the China property, the group is also said to have hired
international stockbroking houses and property agents to look for a
buyer for the 220-room Maxcourt Hotel in Changcun, Jilin province in
Northeast China. It is believed that there has been interest in the
hotel, which currently enjoys almost full occupancy.
Sources said Talam sold the hotel to unlock its value, in line with its
decision to focus on property development and hive off its non-core
assets.
An international real estate firm is said to have conservatively valued the hotel at 420mil yuan (RM202mil).
A source said the rapid economic development in the city in the last
two years, as a result of the Chinese government’s efforts to
revitalise the old industrial base in northeast China, had boosted the
value of the hotel, in which Talam had invested less than RM100mil.
Changcun is an important automobile manufacturing hub in China.
Apart from these divestments, Talam is also said to be in talks with
several interested parties to sell three acres next to YTL group’s Ritz
Carlton Hotel in Jalan Imbi, Kuala Lumpur, for slightly below RM100mil.
Investment analysts said the divestments would help to reduce the group's gearing and unlock the value of its assets.
As at Jan 31, the group’s short-term debts amounted to RM1.8bil.
Some analysts reckon the company’s value would be enhanced if the group
manages to generate the estimated RM400mil from its asset sales.
“Cash proceeds of RM400mil is a lot for a company that has a market
capitalisation of RM530mil,” said an analyst who tracks the company.
source: The Star 6-4-2005
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