Tropicana Corp to sell another land in Johor to KSL for RM21m

• The combined proceeds raised from these three rounds of disposals — RM234.09 million — could be used to repay the group’s existing bank borrowings and improve gearing level

KUALA LUMPUR (Feb 7): Tropicana Corp Bhd is selling a 10.85-acre land in Pontian, Johor, to KSL Holdings Bhd for RM21.27 million.

The original cost of investment for the freehold land in 2013 amounted to RM7.67 million, said Tropicana in a Bursa Malaysia filing on Friday, adding that the expected gain from the disposal would be RM1.59 million.

The latest sale comes after two previous disposals to KSL by Tropicana last year. The group in August proposed to sell 84 acres of land in Johor Bahru to KSL for RM109.89 million, and subsequently in September proposed to dispose of 53.89 acres of land in Pontian for RM102.94 million.

Tropicana said the disposals are an opportunity to immediately unlock value. The combined proceeds raised from these three rounds of disposals — RM234.09 million — could be used to repay the group’s existing bank borrowings and improve gearing level, the group said.

All three disposals are expected to be completed in the third quarter of this year.

For the nine-month period ended Sept 30, 2022 (9MFY2022), Tropicana's net loss doubled to RM121.21 million, from RM60.11 million in the previous corresponding period, despite revenue growing 25% to RM756.36 million from RM605.96 million.

The group’s cash and bank balances stood at RM584.28 million as at 9MFY2022, down from RM638.60 million as at end-2021.

Tropicana’s short-term borrowings amounted to RM1.14 billion as at 9MFY2022, more than double the RM544.64 million as at end-2021, while long-term borrowings declined to RM2.66 billion from RM3.37 billion.