Withdrawal from acquisition

RNS Number : 2623Z

Aseana Properties Limited

12 January 2011

 



12 January 2011

Aseana Properties Limited

("Aseana" or "the Company")

Withdrawal from acquisition of development land in TM Mont' Kiara Commercial Development

Aseana Properties Limited (LSE: ASPL), a property developer investing in Malaysia and Vietnam, listed on the Main Market of the London Stock Exchange, announces that it has decided that it will not proceed with the purchase of the development land in Mont' Kiara, Kuala Lumpur, Malaysia (the "Acquisition"), due to uncertainty in the timing of completion of the Acquisition. The Company has decided to reallocate the funds set aside for this project into its existing projects.

Further to its announcement dated 13 August 2007, Aseana was to acquire, for RM10.8 million (US$3.13 million), approximately 54,000 sq ft of development land from United Time Development Sdn. Bhd. ("UTD"), a wholly owned subsidiary of Ireka Engineering & Construction Sdn. Bhd., a company in the same group as Aseana's development manager. The Acquisition was conditional on receipt of the necessary approvals from the relevant authorities including a development order from the City Hall of Kuala Lumpur, which to date has not been obtained. UTD had entered into a Sales and Purchase Agreement ("SPA") with a third party to acquire the land on behalf of Aseana shortly before its London Stock Exchange listing. Following Aseana's decision not to proceed with the Acquisition, UTD may decide to proceed with the development of the project upon receipt of the above approvals and completion of the SPA.

For further information:

Aseana Properties Limited	Tel: [phone]
Tan May Lee	Email: [e-mail]
Panmure Gordon (UK) Limited	Tel: [phone]
Richard Gray / Andrew Potts / Tom Nicholson	Email: [e-mail]
Tavistock Communications	Tel: [phone]
Jeremy Carey / James Verstringhe	Email: [e-mail]

Notes to Editors:

London-listed Aseana Properties Limited (LSE: ASPL) ("Aseana" or "the Company"), is a property developer investing in Malaysia and Vietnam.

Aseana typically invests in development projects at pre-construction stage.  Investment is made in projects where it is believed there will be a minimum 30% annualised return on equity ("ROE") on investments in Vietnam and a minimum 20% ROE on investments in Malaysia.

Ireka Development Management Sdn Bhd ("IDM") is the exclusive Development Manager for Aseana. It is a wholly-owned subsidiary of Ireka Corporation Berhad, a company listed on the Bursa Malaysia since 1993, which has over 40 years experience in construction and property development. IDM is responsible for the day-to-day management of Aseana's property portfolio and the introduction and facilitation of new investment opportunities.

Fundamentals of Malaysia and Vietnam remain strong for future growth, especially with indications pointing to strong growth in emerging markets this year. In particular, the real estate sectors are likely to flourish due to:

•	An increasing standard of living and urbanisation driven by a burgeoning young and middle-class population
•	Clear government role in encouraging participation of private sectors in real estate development, as well as encouraging and promoting land and property ownership
•	Improving availability or mortgages to encourage property ownership
•	Favoured foreign direct investment destinations driving demand for commercial and industrial properties

 

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