KUALA LUMPUR: Skyworld Development Bhd will pay RM67.9 million for a plot of freehold vacant land in Ho Chi Minh City, Vietnam, marking the company's first transaction outside Malaysia.
The Kuala Lumpur-city developer intends to develop a 24-storey residential apartment over the land, with an estimated gross development value of RM310.4 million.
The land deal will be carried out through the acquisition of a Vietnamese company, Thuan Thanh Trading Production and Real Estate Trading Joint Stock Company (the project company).
SkyWorld Development (Vietnam) Co Ltd, its wholly-owned subsidiary, had on Sept 7 signed a conditional share sale and purchase agreement with three individuals, Nguyen Son Hai Long, Nguyen Thuy Thoai Phuong, and Nguyen Thuy Diem Phuong, as well as Thuan Thanh Trading Production and Real Estate Trading Joint Stock Company, to acquire the project company.
"The acquisition will be entirely satisfied in cash. Upon completion, the project company will become an indirect wholly-owned subsidiary of SkyWorld," it said in a filing with Bursa Malaysia.
The acquisition will be funded through a mix of internally generated funds, bank borrowings, or the issuance of Islamic commercial papers and Islamic medium-term notes.
The deal is expected to be completed by the fourth quarter of 2024.
SkyWorld founder and non-independent executive chairman Datuk Seri Ng Thien Phing said the land acquisition is a key milestone as it is its first venture overseas.
"Since our listing in July, we have consistently reiterated that our goal is to penetrate into Vietnam, especially since we have invested countless hours analysing the Vietnamese housing market.
"The strategic location of the land in Ho Chi Minh City makes it an ideal canvas for our innovative and sustainable projects," he said.
The proposed acquisition is in line with the company's geographical expansion plan by bringing its urban property development business model into Ho Chi Minh City.