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Thursday, March 29, 2012

BRDB closer to open tender

PETALING JAYA: Bandar Raya Development Bhd (BRDB) is one step closer to selling off its four prime assets via an open tender, after the company announced the appointment of its legal and financial advisers to assist in the deal.

In a filing with Bursa Malaysia, the company said it was working with Lee Hishammuddin Allen & Gledhill and CIMB Investment Bank Bhd to assist in the proposed disposal.

It said the board had decided to proceed with the proposed disposal, while noting that Ambang Sehati Sdn Bhd had to-date been unable to confirm its plans to increase its stake in BRDB.

In September 2011, Ambang Sehati proposed to buy BRDB's properties, namely Bangsar Shopping Centre, Menara BRDB, CapSquare Retail Centre and Permas Jusco Mall for RM914mil.

The proposal drew criticism from various parties, who expressed concern over the lack of transparency in the deal and the fairness of the offer price, coupled with the fact that it was a related-party transaction.

Subsequently, the company called off the sale and decided to call for an open tender to take into consideration the interest from credible parties to acquire its assets, and also Ambang Sehati's intention to increase its stake in the company.

Ambang Sehati is the private investment vehicle of Datuk Mohamed Moiz Jabir Mohamed Ali Moiz, BRDB's chairman, who owns 18.88% of BRDB.

“The company had decided to proceed with the disposal exercise. Last year, when the news broke (about the four properties), Ambang Sejati wanted to buy (them). At that point in time, Ambang Sejati was thinking of increasing its stake in the company, that is why the board decided to defer the exercise.

“That was 2011, and now Ambang Sejati is still evaluating its options, but the board can no longer wait for them and this (announcement) is a go-ahead with the tender,” said a source familiar to the matter.

He said the company had not appointed a property consultant yet but the legal adviser appointed was in the midst of finalising the proposal on how to go ahead with the tender.

OSK Research said it was acceptable for BRDB to monetise its assets as long as the company disposed of them at a fair and attractive pricing.

“As we think Ambang Sehati's offer price is unattractive, we see the open tender route as positive as this would enable the group to garner better pricing for its assets via competitive bids from other interested parties,” it said.

It said it was very likely that the company would distribute some of the disposal proceeds as special dividend to its shareholders.

By The Star

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