Lim Seong Hai Capital Inks Upstream Integration

Lim Seong Hai Capital Berhad has announced a series of corporate proposals which marks its upstream integration expansion into property development, and to further strengthen its fast-growing construction business.

Upon completion of the Proposals, the LSH Capital Group will have an enlarged secured construction orderbook amounting to RM1.1 billion in aggregate with an overall outstanding orderbook of RM782.0 million and also carry a property development project with GDV of RM1.59 billion which is expected to provide earnings visibility until 2026.

In addition, the LSH Capital Group also involves in construction and property development projects amounting to RM2.7 billion via the BEST Framework collaboration. This collaboration will enable the Group to earn certain portion in fees for various value creation efforts.

The corporate proposals entail with a combined acquisition value of RM157.6 million via the execution of Share Sale Agreement to acquire 100% in Astana Setia for RM95 million, Assets Exchange Agreement and Debt Settlement cum Share Subscription Agreement with LSH Ventures for a total value of approximately RM62 million to be full satisfied via issuance of new LSH Capital shares at 45 sen, which presents a premium of 7.14% to 9.20% over the closing market price on 25 March 2022 and volume weighted average price of 6 months.

Astana Setia has an existing RM395.9 million gross development value (GDV) for its Residensi Laman Segar Hijau (LSH Segar) development project in Taman Segar, Cheras. Astana Setia’s flagship LSH Segar project has secured 100% uptake under the RUMAWIP affordable housing scheme, and 70% uptake among open units. Astana Setia also has an external construction order book of RM390.81 million, of which RM146.82 million is still outstanding.

Th proposed transaction with LSH Ventures involves the acquisition of four parcels of lands and buildings on-site in attractive locations across Kuala Lumpur, Kajang and Johor Bahru for a consideration of RM8.14 million. In addition, LSH Capital will settle approximately RM54 million amount owing to directors of LSH Venture.

Upon completion, LSH Capital will own 99% in LSH Ventures and will have 93.75% effective interest in Astana Setia & Euro Saga, an entity which will launch the upcoming flagship project “Lake Side Homes” on a 11.85-acre land in Sungai Besi
with an estimated GDV of RM1.19 billion.

Moving forward, the group will seek shareholder approval to expand its core businesses to include property and construction-related business as these new integrated upstream businesses are expected to contribute more than 25% of the group’s net profit.

Astramina Advisory Sdn Bhd is the Approved Adviser and Continuing Adviser for LSH Capital and is the appointed Adviser for the proposed corporate exercises.

Previous articleGartner Shortlists Ramssol’s Human Capital Management App As Among Top 7 In Asia Pacific
Next articleKDEBWM: Adopting IR4.0 To Improve Lives

LEAVE A REPLY

Please enter your comment!
Please enter your name here