GuocoLand unit submits winning bid

SINGAPORE (Nov 30): GuocoLand Ltd said its Chengdu subsidiary in China submitted the winning bid price of 3.64 billion renminbi (RM2.35 billion) for four plots of land in Chongqing to build a mixed development for retail, business and residential use.

With a total land area of 48,961 sq m and total above ground gross floor area of 513,600 sq m, the land parcels are located within the Jiefangbei (Liberation Square) Commercial Belt, with views of the Yangtze River, in the Yuzhong District. Yuzhong is Chongqing’s key district and it’s well connected to the surrounding districts via a massive network of metro lines and bridges.

To jointly acquire and develop the land parcels, GuocoLand has entered into an agreement with Hong Leong Holdings (China) (HLHC). This will be done through the subscription for new shares in GLL Chengdu, in such that GuocoLand and HLHC will hold a 75% and 25% stake respectively in the enlarged issued share capital in GLL Chengdu.

Based on the acquisition consideration of the land parcels of 3.64 billion yuan and the related expenses and costs, the initial capital contribution of HLHC for its 25% shareholding is estimated to be 946.5 million yuan. A project company, which will be a wholly-owned subsidiary of GLL Chengdu, will be established to undertake the development.

A subsidiary of Hong Leong Investment Holdings, HLHC is deemed an interested person of GuocoLand under Singapore listing rules. Malaysian billionaires Quek Leng Chan and brother Kwek Leng Hai are GuocoLand directors and HLHC shareholders. The Quek and Kwek families own Hong Leong Co (Malaysia) Bhd, which in turn owns about 71% of GuocoLand. Shares in GuocoLand closed at S$1.88 (RM5.88). — theedgemarkets.com.sg

This article first appeared in The Edge Financial Daily, on Nov 30, 2016. Subscribe to The Edge Financial Daily here.