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Monday, January 21, 2008

MK Land targets RM200m en bloc sales

MK LAND Holdings Bhd, a developer, plans to raise up to RM200 million from en bloc sales of its residential properties, a deal that could kick-start its turnaround.

The company, which has a large piece of prime land in Damansara Perdana, Petaling Jaya, is losing money due to slow sales, but its management has plans to return to profit.

"Our problem is that we are asset-rich. We are working on several initiatives. I think we can pull it through," chief executive officer Datuk P. Kasi told Business Times in an interview.

MK Land is in talks with a few foreign parties, including from the Middle East, and local ones on the en bloc sales in Damansara Perdana. He declined to name them.

In addition, MK Land is working on a 9.2ha commercial project modelled along the likes of the Mid Valley Megamall or the Pavilion. It is talking to potential partners on the project.

There is also a new share sale that has been approved.

"My view is, all three will happen. I'm hoping all three will happen this year. Our view is that we must be ready," Kasi said.

The spotlight was on the company for the wrong reasons recently when Malaysian Rating Corp Bhd cut the rating on its debt. It also raised questions about whether the company could meet a RM60 million bond repayment due on August 29 this year.

Kasi brushed off the bond downgrade, saying that MK Land would be able to meet its obligations.

"The issue here is only a temporary thing because of a slowdown in sales," he said.

MK Land stock now trades at around 62 sen, well below the placement price of RM1. The low share price means that the placement will be difficult to pull off.

However, Kasi is optimistic. He believes that one good news will lead to another and MK Land's fortunes will change when that happens.

"There is sufficient time (to meet the bond payment)," he said. If MK Land clinches the en bloc sales or gets a partner, "people may look at the company differently", Kasi argued.

By New Straits Times (by Shahriman Johari)

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