REALLY? Boustead sees 25pc return from Deepak-Ropiaah land buy

KUALA LUMPUR- Boustead Holdings Bhd is confident of generating 25 per cent return on development cost from its RM160 million acquisition of 81ha of land in Bukit Raja, Selangor, from Astacanggih Sdn Bhd.

In a statement yesterday, Boustead directors said the acquisition is an opportunity for the group to increase its landbank to benefit from economies of scale by combining the 81ha land with the adjacent 283.4ha land held under Jendela Hikmat Sdn Bhd.

Boustead and Lembaga Tabung Angkatan Tentera jointly hold 60 per cent equity interest in Jendela Hikmat.

As part of the land acquisition, Boustead, through its wholly-owned subsidiary Bakti Wira Development Sdn Bhd, is acquiring 80 per cent of Astacanggih.

"The acquisition of 80 per cent Astacanggih forms part of this corporate exercise to acquire an 80 per cent interest in the 200-acre development land in Bukit Raja at a total price of RM160 million or RM18.37 per square feet."

Boustead and Bakti Wira started negotiating with Awan Megah Sdn Bhd on the latter's proposed sale of the Bukit Raja land in April 2005, while Boustead received an offer letter from Astacanggih shareholders of their proposed sale of Astacanggih in June 2012.

However, Boustead was only able to conclude the final agreements in the third week of December 2012 after a prolonged negotiation with the parties.

-btimes.com