Landmarks selling 26.6% stake in Shangri-La
PETALING JAYA: Landmarks Bhd has proposed to sell its 26.6% stake in another listed firm Shangri-La Hotels (M) Bhd for a profit, as the company seeks to reduce debt and focus on its own hotel development project.
Shares in Landmarks surged to an intra-day high of RM2.26 yesterday, but settled up 30 sen at RM2.16 before trading was halted at 2.32pm after the announcement was made during the midday break.
The stock will resume trading today.
“The proposed disposal is consistent with Landmarks' long-term plan to focus its resources, both financial and management time, to be a regional player in resort development and management, as well as in the hospitality sectors,'' the company said in a statement to Bursa Malaysia yesterday.
Under the proposal, Landmarks plans to place out 117 million shares in Shangri-La for RM287mil, or RM2.45 per share, to investors to be identified by appointed placement agent CIMB Investment Bank Bhd.
Shangri-La shares jumped eight sen in thin trading to RM2.58 before their suspension yesterday. The counter will also resume trading today.
The shares' disposal would result in a one-off gain of RM102.7mil, or 21 sen a share, for Landmarks. “The prevailing market price for Shangri-La shares is favourable and (Landmarks) intends to realise its investment at a fair price,'' the company said.
Of the total proceeds, RM130mil will be used to reduce bank borrowings and the balance for working capital requirement of Landmarks and its subsidiaries. It is estimated that the lower debts would result in interest savings of RM6.1mil a year for Landmarks.
This is the second major disposal this year by Landmarks following the sale of its stake in Sungei Wang Plaza for RM284.8mil.
The company is also believed to be looking to sell its 20% stake in an independent power plant in Perlis.
Source : STAR
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