Tiong Nam’s wholly-owned subsidiary, Tiong Nam Logistics Solutions (TNLS) has entered a joint venture (JV) agreement with JLand Group (JLG) to develop a high-tech logistics industrial park on a 300-acre land at Sedenak Technology Valley, Johor.
JLG is a wholly-owned subsidiary of Johor Corporation.
The industrial park aims to attract foreign and domestic enterprises and serve as a key node in their supply chain management. The development will comprise ready-built and customized warehouses, factories, and commercial buildings, as well as integrated logistics infrastructure for global businesses.
The JV agreement followed on from a preliminary collaboration agreement announced in August 2022 that encapsulated both parties’ commitment to undertake the development.
A JV company – JTN Logistics Park Sdn Bhd (JTN), would be used as the vehicle to undertake the acquisition of the 300-acre land, as well as development and management of the industrial park.
Under the JV agreement, TNLS will hold 51,000 ordinary shares, representing 51% equity stake, while JLG will hold the remaining 49,000 ordinary shares or 49% equity stake in the JV company.
JTN will acquire the development land from JLG for a purchase consideration of RM52.3 million or RM4.00 per square foot.
The land has a leasehold period of 99 years and is currently under the ownership of Johor Corporation, and will be procured by JLG before its sale to JTN.
“We are proud to partner with the Johor state’s development institution to jointly develop a pioneering world-class logistics industrial park, that is envisioned to attract significant foreign
and domestic investments into the state,” Ong Yoong Nyock, Managing Director of Tiong Nam Logistics Holdings Berhad said.
“Our JV with JLG is a recognition of our capabilities and a major milestone in our track record in transforming Johor’s logistics landscape over the past four decades,” Ong added.
“We will bring tremendous value to the project which caters to Johor’s strategic goals, by leveraging on our experience as a leading integrated logistics and warehousing services provider to multinational customers across Southeast Asia. The technology-enabled development will also enhance the state’s logistics infrastructure to support greater international connectivity and trade,” Ong concluded.
JTN is expected to prepare and submit the development layout plans to the Johor state authorities within the next 12 months or an extended period to be mutually agreed upon.
Construction of the logistics industrial park is expected to begin in 2025, or within three years from securing approval for the development layout plan and other relevant authority approvals.
JTN will pay the land purchase consideration to JLG through advances from the JV shareholders. Meanwhile, TNLS will be responsible for funding the working capital for the development through internally generated funds.
