Tan Chong Motors to dispose of land to Avaland's unit for RM148.8mil
The automotive group said its wholly owned subsidiary Tanahku Holdings Sdn Bhd, which owns the land along Jalan Putra, today inked a sale and purchase agreement (SPA) with Avaland Bhd's indirect subsidiary Solid Interest Sdn Bhd for the disposal.
"The disposal will allow the group to unlock the property's value, which remains favourable at this juncture.
"The sale proceeds will strengthen the group's liquidity position, enabling it to meet working capital requirements and support investment in new projects," TCMH said in a filing with Bursa Malaysia.
It said that the net proceeds from the disposal, after deducting all fees and expenses in relating to the disposal, would be utilised to strengthen the working capital reserve to support operational needs and to invest in other opportunities aligned with the group's long-term objectives.
It added that the quantum and timing of utilisation could not be ascertained yet as it would depend on the actual amount available and actual capital requirements at the point of time.
"Any part of the disposal price which has yet to be utilised will be placed in deposits with financial institutions or short-term money market instruments.
"Interest derived from the deposits placed or any gain arising from short-term money market instruments will be used as working capital of TCMH and its group of companies," TCMH said.
Tanahku is a property investment holding company and the property are assets held for investment property purposes for over eight years.
Subject to the fulfilment of the conditions precedent stipulated in the SPA, the disposal is estimated to be completed by the first quarter of the financial year ending Dec 31, 2026.
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