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Saturday, August 8, 2009

L&G to focus on property, plantation and education

KUALA LUMPUR: Land & General Bhd (L&G) is embarking on a new chapter of business growth after settling all its debts and will now focus on property, plantation and education as its main business.

Managing director Low Gay Teck said with cash reserves of about RM100mil, L&G would unlock some of its assets for property developments that would contribute positively to the company’s performance in the financial year ending March 31.

“Our main focus will be the developments in Bandar Sri Damansara that include commercial, high-end condominiums and the recently launched commercial development of 8trium,” he said yesterday after the company EGM.

Shareholders had approved the proposed resolutions to reduce the par value of L&G shares from RM1 to 20 sen and reduce L&G’s share premium from RM133mil to RM14.6mil.

Low said the credit resulting from the exercise would be sufficient for L&G to fully eliminate its accumulated losses of RM597mil as at March 31.

Having settled its redeemable convertible secured loan stocks of RM71.7mil on June 30, L&G’s gearing is now zero.

Low said for FY10, property business would contribute more than 50% to L&G’s revenue while the rest would come from plantation and education business.

“We plan to launch a high-end condominium project with an estimated gross development value of RM1bil in Bandar Sri Damansara. Our sales launch target is next year. This project will take about five to eight years for completion,” he said.

He added that the company also had 36 acres and 12 acres respectively in Sungai Petani, Kedah and Johor Baru that could be used for future development or disposed of for income.

L&G was also in the process of disposing part of Sri Damansara Business Park for about RM30mil.

On plantation business, Low said L&G was targeting to complete the planting of oil palm on the remaining half of its Ladang Sg Jernih estate near Tanjung Malim within three years.

Ladang Sg Jernih is about 2,500 acres, of which 50% is currently planted with oil palm and rubber trees.

“In the education sector, we will continue to expand Sekolah Sri Bestari’s (in Bandar Sri Damansara) physical facilities and continue with teachers’ training programmes as the main strategies to increase student enrolment,” Low said, adding that this year, the school’s enrolment was 1,000, a modest increase from last year’s 943 students.

Low said L&G was also looking for more land locally (around the Klang Valley) and internationally for future property development opportunities either through joint ventures or strategic alliances with landowners.

Currently, the company is involved in a joint venture development called Hidden Valley in Melbourne, Australia, developing 2,500 acres for bungalow lots and a 18-hole golf course. Low said about 70% of the development was already sold.

By The Star

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