IOI Properties receives proposal from CEO to jointly develop Shenton House in Singapore

KUALA LUMPUR (June 25): IOI Properties Group Bhd (KL: IOIPG) has actually received a plan from its group chief executive officer cum major shareowner Lee Yeow Seng to take part in the development of Shenton House, a business property located in Singapore that his private vehicle has actually effectively tendered for, for S$ 538 million (RM1.9 billion).

According to IOIPG, Yeow Seng has actually suggested the purchase consideration be determined based upon the actual expense of assets incurred by himself and Shenton 101, multiplied by the equity interest in Shenton 101 to be obtained by IOIPG, or an equivalent membership value for the membership of new stakes in Shenton 101.

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Yeow Seng and his sibling Datuk Lee Yeow Chor are primary shareholders of IOIPG via their considerable shareholdings in Vertical Capacity Sdn Bhd, which takes 65.67% in IOIPG.

The current additional existing resources obligation– leaving out the property development cost, which is to be settled– is S$ 476 million, that includes land betterment rates, lease top-up premium, and operation expenditures, it stated.

IOIPG stated the plan is valid for 4 months, which might be extended by another two months if a written application is obtained from IOIPG.

According to a stock market filing, Yeow Seng has proposed that IOIPG obtain entirety or part of his exclusive vehicle, Shenton 101 Pte Ltd, which is preparing to redevelop Shenton House, works for which are set up to start at the end of 2025.

Shenton 101 was the sole prospective buyer of Shenton House, that lies in Singapore’s central business center. Yeow Seng formerly pointed out he felt it was better suited to bid for Shenton House using his own vehicle because of the size of the subject and the tight time set by the sales council on the collective sale.

“Yeow Seng has stressed to IOIPG that Shenton 101 is ready and able to continue with the property development preparation of Shenton House within the terms of the tender which Shenton 101 is well on the way to put in place funding to enable it to go on with the redevelopment and also the factor that Yeow Seng is prolonging the proposal to IOIPG is to aid resolve or address the probable problem of interest situation,” IOIPG’s declaring read.

“The good faith purpose of Yeow Seng is not to make a private gain emerging from the proposition. As such, the factor to consider is to include the initial cost of investment of equity in Shenton 101 and the expense incurred by Shenton 101 for the purchase of Shenton House and any advance fees had by Shenton 101 such as consultants’ fees and costs and tender, application and approval expenses as well as cost of finance,” IOIPG added.

At market close on Tuesday, IOI Properties’ shares lost four sen or 1.75% to RM2.25, bringing the company a value of RM12.39 billion.

This is to attend to and minimize the prospective dispute of attention that will develop because of his job in the redevelopment of Shenton House with Shenton 101, in which he is the single shareowner. The intention of the plan is to coordinate the interests of IOIPG with that of Shenton 101, which are going to keep the redeveloped property as venture upon its successful redevelopment.

Shenton House covers 3,377 square metres and is marked for retail use with a gross plot ratio (GPR) of 11.2. The premises has a 44-year land lease, with the possible to be lengthened to a fresh 99-year lease.

“Further, according to the Singapore’s central business district benefit system, Shenton House is eligible for a 25% reward gross floor area that can be redeveloped into a mixed-use commercial with non commercial project or a hotel at the GPR of 14. Because of this, Shenton House is earmarked for redevelopment into a fresh 99-year leasehold business development,” IOIPG claimed.

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