Property developer Tropicana Corporation has entered into a conditional share sale agreement with founder Danny Tan and his children to acquire a 50.1% stake in Peluang Duta for RM49.05 million. This is in a bid to increase its land bank.
According to a Bursa filing, Peluang Duta has a 70% owned subsidiary company named T Sanctuary Development, which owns 329.1 acres of mixed commercial and residential approved landbank in Johor Bahru. The two plots of land are close to Singapore and other matured township developments, and poses a “good opportunity” for Tropicana to further enhance its brand name and presence, particularly in the southern region.
The overall proposed development component comprises mainly 70% residential and 30% commercial, which includes terrace houses, shop offices, urban affordable homes, serviced apartments as well as an international school. It is expected to generate approximately RM4.3 billion of gross development value, thereby boosting Tropicana’s future revenue and earnings. The deal is expected to be completed by October this year.
The filing added that due to the positive property outlook in Johor, with the increased transaction volume by 11.6% in the first quarter of 2018 compared to the preceding quarter in 2017, as well as the residential sector remaining dominant in the overall property market, Tropicana is “optimistic” that the properties located at prime locations are still “well-sought”.
One of its projects in Iskandar, Tropicana Danga Cove, has been “well-received” and the proposed acquisition rides on the success of Tropicana Danga Cove, allowing Tropicana to increase its landbank size in prime locations in Johor that have positive development value.
(Photo courtesy: 123RF)