ECM Libra Group Bhd (ECMLG) has secured banking facilities of up to RM130 million from RHB Bank Bhd to finance the development of a new beachfront hotel in Desaru, Johor, as the group expands its hospitality portfolio.
The investment holding company said its indirect wholly-owned subsidiary, Desaru Beachfront 2 Sdn Bhd (DB2SB), had accepted the financing package comprising a term loan of up to RM120 million and revolving credit facilities of up to RM10 million.
The financing will be used to partly fund the construction of the proposed beachfront hotel on land owned by DB2SB, while the revolving credit facilities will support the subsidiary’s general working capital requirements.
ECMLG said the project will be developed on a parcel of leasehold commercial land in Mukim Pantai Timur, Kota Tinggi, Johor, a key tourism and resort destination within the Desaru Coast development corridor.
The banking facilities are secured by several forms of collateral, including a corporate guarantee from ECM Libra Group, a first legal charge over DB2SB’s 36,831-square-metre commercial land, as well as a first legal charge over another adjoining 44,427-square-metre leasehold commercial parcel owned by ECM Libra Beachfront Sdn Bhd, another indirect wholly-owned subsidiary of the group.
Under the financing agreement, RHB has also imposed shareholder covenants requiring Executive Chairman and major shareholder Datuk Lim Kian Onn and his family to remain substantial shareholders of ECMLG throughout the tenure of the facilities, while any changes to DB2SB’s shareholding structure will require the bank’s prior written consent.
ECMLG said the financing enables the group to fund the hotel project through an appropriate mix of borrowings and internal funds, while supporting its long-term strategy of growing its hospitality business.
