KUALA LUMPUR: Yong Tai Bhd will sell its 5-star Courtyard by Marriot Melaka hotel to Southern Envoy Sdn Bhd for RM160 million. According to Yong Tai, its wholly-owned subsidiary, Apple 99 Development Sdn Bhd has entered into a conditional sale and purchase agreement with Southern Envoy.
It said the proposed sale of the hotel represents an opportunity for Yong Tai to immediately unlock the hotel’s value and it is expected to provide an estimated net pro forma gain on disposal of approximately RM45.86 million.
“The proposed disposal will give rise to RM160 million in proceeds to be utilised by the group to repay the Apple 99’s existing bank borrowings and payment of outstanding progress claims to the main contractor, hence improving Yong Tai’s gearing level.
“Upon completion of the proposed disposal, Yong Tai is able to improve its financial performance and realise a gain, thereby strengthening its cash flow and net assets position,” it said.
Yong Tai said the hotel’s market value, as appraised by Nawawi Tie Leung Property Consultants Sdn Bhd, using the comparison approach and supplemented by the income approach, based on its valuation report dated 1 June 2024 of RM170 million.
Meanwhile, the group also proposed a special issue of up to 30% of the total number of issued ordinary shares in Yong Tai, excluding treasury shares, to independent investors to be identified and at an issue price to be determined at a later date.
It said the proposed special issue would entail the issuance of up to 190 million new shares, which was arrived at based on 30% of its enlarged issued share capital of RM843.02 million comprising 633.50 million shares.
“The proposed special issue will enable the group to raise funds more expeditiously and in a more cost-effective manner as opposed to other fundraising options such as a pro-rata issuance of securities,” it noted.
Yong Tai added the proposed special issue would improve the liquidity and financial flexibility of the group by strengthening its financial position.
— BERNAMA
