TWL Holdings Bhd is putting out a rights issue proposal to raise money for the development of ongoing projects.
Gross development value (GDV) and gross development cost (GDC) for the projects as a whole are anticipated to be RM624.1 million and RM523.5 million, respectively.
TWL stated in a filing with Bursa Malaysia yesterday that the projects are anticipated to start in the first quarter of 2023 and end in the fourth quarter of 2028, subject to the necessary permits being secured and the availability of finance.
The projects include the RM45 million purchase of the EN10 Land, EN11 Land, and HT4 Land in Petaling Jaya.
Sime Darby Property Bhd is the sole shareholder of SDP Bukit Raja, which in turn, is the beneficial owner of the lands.
Its subsidiary, Sime Darby Property (Bukit Raja) Sdn Bhd (SDP Bukit Raja), and INTA Development Sdn Bhd are selling their land to TWL's indirect units so they can build three affordable housing developments as part of the Rumah Selangorku programme.
TWL has proposed to conduct a renounceable rights offering of 4.01 billion redeemable convertible unsecured loan stocks (RCULS) having a nominal value of RM120.20 million, along with 1.14 billion free detachable warrants in the firm (Warrants E).
The company stated that it plans to use the money obtained through the planned rights issue to pay suppliers of building supplies, contractors for building and exterior work, consultants, and the appropriate authorities for the affordable housing projects.
It said that any funding gap for the projects is anticipated to be covered by internally generated cash, bank borrowings, or additional fund-raising activities that will be performed, as needed.
In light of the transition to the endemic phase beginning on April 1, 2022, TWL said that it seeks to accelerate the progress of its present projects to produce income and cash flows for the company.
"Apart from the property development projects mentioned above as well as the EN10 Project, EN11 Project, and HT4 Project, which will be undertaken after completion of the acquisitions, we will continue to explore opportunities for new property development projects with a priority on the affordable housing segment.
"We also intend to acquire land banks in strategic locations at attractive prices given the anticipated softer property market following the COVID-19 outbreak," the company said.
The GDC of RM523.5 million for the three projects is estimated to be incurred throughout the three-year development term, according to a filing made by TWL on August 4.
For the EN10, EN11, and HT4 projects, respectively, TWL Group plans to build 715, 746, and 1,139 low-cost/affordable housing units.
The price of each housing unit ranges from RM150,000 to RM250,000.