KUALA LUMPUR: Atlan Holdings Bhd's indirect subsidiary, Cergasjaya Sdn Bhd and Cergasjaya Properties Sdn Bhd (CPPA), have received a notice for the compulsory acquisition of their land in Bukit Kayu Hitam, Kedah, for a road construction project.
Atlan holds Cergasjaya and CPPA through its 75.53 percent-owned subsidiary, Duty Free International Ltd (DFI), which is listed on the Singapore Exchange.
In its filing with Singapore Exchange yesterday, DFI said the land was acquired by the Malaysian Ministry of Home Affairs and is administered by the Kedah Director General of Lands and Mines Department.
"The compulsory acquisition of the land is required for a road construction project to connect the Bukit Kayu Hitam Immigration, Customs, Quarantine, and Security Complex (ICQS) to the CIQ Sadao facilities in Thailand," the company said.
Cergasjaya owns the Duty-Free Complex in Bukit Kayu Hitam, while CPPA holds leases for three parcels of land from the Kedah State Development Corporation (PKNK).
DFI added that the compulsory land acquisition would lead to the closure of Cergasjaya's duty-free business.
As of the end of February, Cergasjaya contributed about 24 percent to the company's revenue.
The land valuation process to determine compensation is ongoing, and DFI is working with legal advisors to ensure fair compensation.
The financial impact will be announced once the process is completed, said DFI.