Update on the demerger proposal

RNS Number : 1949T

Aseana Properties Limited

16 July 2020

 

15 July, 2020

Aseana Properties Limited

("Aseana" or the "Company")

Update on the demerger proposal and on our remaining assets

Demerger proposal

Aseana Properties Limited (LSE: ASPL LN), a property developer in both Malaysia and Vietnam which is listed on the Main Market of the London Stock Exchange, has now entered into certain agreements in relation to proposals to demerge certain assets held by the Company in exchange for the buyback and cancellation of a significant percentage of the issued ordinary shares of US$0.05 each in the capital of the Company (the "Shares") and announces a revised expected timing for the Transaction.

The Directors of Aseana have now signed a Share Buyback Agreement which would enable the Company to buy back the Shares owned by Ireka Corporation Berhad ("Ireka") and its concert party Legacy Essence Limited ("Legacy Essence") along with certain other Shareholders (the "Participating Shareholders"), who together own approximately 50% in aggregate of the outstanding shares in the Company, in exchange for certain assets of the Company (the "Transaction"). The consideration will be an in specie distribution of certain assets owned by the Company to the Participating Shareholders together with a balancing cash payment, to the Company from Participating Shareholders, to reflect the relative value of the assets to be distributed and the value of the shareholding of the Participating Shareholders as at the date of the buyback. The Company has assessed the net book value of the Company's assets for the purposes of the Transaction based on the unaudited net asset value as at 31st December 2019 and has agreed with Ireka that adjustments should be made, where appropriate, to reflect the settlement of potential claims that ASPL may have against Ireka or its group companies in connection with the Company's projects, including the settlement of amounts owing to the Company by a subsidiary of Ireka relating to the development and construction of The RuMa Hotel and Residences in Kuala Lumpur ("RuMa"). The assets that will be distributed in specie will comprise RuMa, one of three plots of adjacent land owned by the Company in Kota Kinabalu and the residual projects from past developments. Any Shares so acquired by the Company would be cancelled. Following the Transaction there will be a complete separation of the interests of Ireka and Legacy Essence from the Company.

Following the announcement on 7 May 2020 regarding the proposed Transaction, the Directors consulted with other key Shareholders in the Company for their views on the proposed Transaction and there is broad agreement to proceed subject to the passing of a special resolution of shareholders (excluding the Participating Shareholders) which will require the approval of 66 2/3% of those voting at an Extraordinary General Meeting ("EGM") which is now expected will be held in August 2020. Approvals are also being sought from other parties including shareholders in Ireka and the Company's bankers and holders of the Medium Term Notes issued in relation to the financing of The RuMa and Sandakan assets, and if these are received, completion of the Transaction should take place by 14 October 2020. A Circular to Shareholders and an associated Notice of EGM will be issued in due course.

Update on our remaining assets

The Movement Control Order which  was in place in Malaysia was replaced on 10 June 2020  by the Recovery Movement Order which expires on 31 August 2020 which extends the partial lockdown preventing foreign travel and tourism which is still in place throughout Malaysia.  As a result, The RuMa hotel in Kuala Lumpur is still closed but it is planned to re-open on 28 August 2020. The Four Points Sheraton Hotel in Sandakan ("FPSS") is also currently closed because of the movement restrictions and the Directors have also been informed by Marriott International which owns the Sheraton Hotels brand that they are terminating their management of FPSS along with a number of other hotels that they manage in Asia. As a result, the Directors have closed the hotel permanently except for certain maintenance and security functions in order to prevent a deterioration of the building. This decision will be re-visited when a buyer has been found for the hotel. Government restrictions for foreigners are also still preventing them from entering Vietnam. However, the Company has continued to maintain a dialogue with prospective buyers of all of its assets and it intends to re-engage fully with them as soon as the movement restrictions are lifted.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (2014/596/EU).

For further information:

Aseana Properties Limited	Tel: [phone]
(via Tavistock)
Liberum Capital	Tel: [phone]
Gillian Martin / Owen Matthews
Tavistock	Tel: [phone]
Jeremy Carey / James Verstringhe	[e-mail]

 

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