Nexgram to acquire property management rights in Langkawi for RM22.5m

• “Due to WINGS being appointed as government Langkawi International Maritime and Aerospace Exhibition (LIMA) 2023 hotelier, management decided to complete the business acquisition first to realise on the investment, while awaiting certain conditions subsequent to be completed for further consideration.”

KUALA LUMPUR (March 13): A day after Nexgram Holdings Bhd aborted its deal to buy Wings By Croske Resort Langkawi Sdn Bhd (WINGS) for RM90 million, the ACE Market-listed firm now says it wants to acquire the management rights of a piece of land in Langkawi, Kedah, from the resort operator for RM22.5 million instead.

In a filing with Bursa on Friday (March 10), Nexgram said its wholly-owned unit Medic Asset Group Sdn Bhd (MAGSB) has entered into a conditional sale and purchase agreement with WINGS to acquire the entire management rights of a 16,900 sq m piece of land together with the 218-room Century One Helang Hotel Langkawi.

The acquisition will be satisfied via the issuance of 250,000 redeemable convertible preference shares (RCPS) at an issue price of RM90 per RCPS in MAGSB to the vendor, namely WINGS.

Notably, this came a day after Nexgram called off a deal to acquire WINGS from Croske Hotels Sdn Bhd and Flyboys Club Sdn Bhd for RM90 million, which was supposed to be satisfied via the issuance of one million RCPS at RM90 apiece in MAGSB to the two vendors.

The failed acquisition of WINGS was first mooted on Sept 29, 2022. Nexgram initially planned to utilise the property as a healthcare service facility by December 2023.

Commenting on the rationale for its latest move, Nextgram now said: “Due to WINGS being appointed as government Langkawi International Maritime and Aerospace Exhibition (LIMA) 2023 hotelier, management decided to complete the business acquisition first to realise on the investment, while awaiting certain conditions subsequent to be completed for further consideration,” said the group.

The acquisition will not have any effect on the earnings and earnings per share for the financial year July 31, 2023.

“However, the proposed acquisition is expected to contribute positively to the future earnings of the group as and when the benefits of the proposed acquisition are realised,” the company said.