MITRAJAYA HOLDINGS BERHAD - Announcements

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The Proposed MSA Acquisition will be conditional upon the conclusion of the Proposed GPIL Acquisition. 2.2.1 Information on the freehold property The freehold property with an acreage of 62.49 hectares vacant farmland is adjoining the Samrand Golf and Country Estate currently developed by Samitra. The freehold property is enclosed within the Samrand Golf and Country Estate surrounded by an eight kilometres electrified security fencing which has been constructed at a cost of Rand4,000,000. The freehold property is overlooking and form part of the Samrand Golf and Country Estate. The development on this property is in the early stage of planning and total estimated development cost is Rand65,000,000. The development of this freehold property will be an extension of the existing Samrand Golf and Country Estate mixed development. It is proposed that the development of the freehold property together with the Samrand Golf and Country Estate be based on creating a high standard secured suburban in Johannesburg. Accordingly, based on preliminary plans, the proposed comprehensive mixed development would include approximately 400 bungalow lots with expected sales value of Rand141,050,000. 2.2.2 Basis of determining the purchase consideration The purchase consideration of Rand11,400,000 works out the land cost to be Rand18.0 per square metre (psm) or approximately RM8.90 psm. The purchase consideration was arrived at on a willing buyer-willing seller basis after taking into account the development potential and strategic location of the freehold property and the current transacting price of neighbouring farmland which is going at about the same rate. A valuation was procured by MSA on the freehold property and was conducted by a South African property valuer, Mills Fitchet. The open market value of the freehold property according to the valuation report dated 31 December 2000 is Rand11,700,000. MHB also commissioned Henry Butcher, Lim & Long Sdn Bhd, an independent registered valuer to conduct a valuation on the freehold property and the latter’s report on 28 February 2001 as enclosed in Appendix IV indicates the same market value of Rand11,700,000. Henry Butcher, Lim & Long Sdn Bhd have adopted the “Comparison Method” and “Discounted Cashflow Approach (known as Development Approach)” of valuation. Samrand initially acquired the freehold property on 9 February 1996 and the original cost of investment to Samrand was Rand5,207,000. 2.2.3 Terms of the Proposed MSA Acquisition A sum of Rand1,000,000 has been paid to Samrand upon execution of the Memorandum of Agreement. Another sum of Rand1,800,000 has been paid on 31 January 2001. There is currently a bond registered in favour of ABSA Bank Ltd over the freehold property. As partial payment of the purchase consideration, MSA will pay Rand5,700,000 in favour of ABSA Bank Ltd for the release of the freehold property 5
in the name of MSA to be registered in the Deeds office at Pretoria. This amount will then be set off against the balance of the purchase price for the freehold property. The balance of Rand2,900,000 payable on the purchase price will be paid by MSA to Samrand on the date of registration of the freehold property in the name of MSA. There will be no liabilities to be assumed by MSA or MHB other than the payment of the purchase consideration. 2.2.4 Rationale for the Proposed MSA Acquisition The Proposed MSA Acquisition provides an opportunity for the MHB Group to have a relatively large piece of freehold land in Johannesburg with good potential for residential and commercial development. It enables the MHB Group to build up further, significantly, its land bank in a strategic location to ensure a substantial steady sourced income from its property development activities in South Africa in the long term. Tapping on the existing completed infrastructure of the adjoining development of the Samrand Golf and Country Estate would allow the development of the freehold property to progress much faster. In addition to this, the saleable area ratio would be higher as it can form part of the residential golf estate without having to alienate further land for public amenities and recreational facilities. The pricing of the products to be launched is also expected to be at higher rates taking into account the already proven and established Samrand Golf and Country Estate. 3. INVESTMENT RISK CONSIDERATIONS Shareholders should carefully consider, in addition to other information contained herein, the following information (which may not be exhaustive) before voting on the Ordinary Resolutions pertaining to the Proposed Acquisitions: 3.1 Political, Social and Economic Considerations The future growth and continued success of Samitra and MSA in South Africa are subject to risks that are linked to any developments in political, social and economic conditions where the MHB Group's current overseas operations are substantially in. Although it is notable that Samitra and MSA recorded profitability during the last two years, no assurance is given that any changes in the political, social and economic conditions in South Africa will not have any adverse impact on the property development business of Samitra and MSA. 3.2 Business Risks The MHB Group’s investment in South Africa is subject to the risks inherent in property development industry. These include, inter alia, supply of labour and building materials, changes in labour and building materials costs, changes in general economic, business and credit conditions, demand for residential, commercial and industrial properties and changes in the legal and environmental framework within which this industry operates. These business risks implicit in all commercial activities and changes to these factors will definitely have implications to the Group’s operations. However, MHB being an established company with proactive management, is well positioned to successfully manage these business risks in the ever changing business environment. 6
Page 1 and 2: THIS CIRCULAR IS IMPORTANT AND REQU
Page 3 and 4: CONTENTS PART A CIRCULAR TO THE SHA
Page 5 and 6: 1.2 In view of the interest of Dato
Page 7: 2.1.3 Terms of the Proposed GPIL Ac
Page 11 and 12: 4. INDUSTRY OVERVIEW AND FUTURE PRO
Page 13 and 14: 5.5 Gearing As the Proposed Acquisi
Page 15 and 16: PART B To: The Shareholders of Mitr
Page 17 and 18: Independent Advice Letter to the Sh
Page 25 and 26: INFORMATION ON MHB 1. History and B
Page 27 and 28: Date of Allotment No. of Ordinary S
Page 29 and 30: Date of Allotment No. of Ordinary S
Page 31 and 32: Name Date and Place of Incorporatio
Page 33 and 34: Minority interests (RM’000) Profi
Page 35 and 36: 4. Particulars of Directors’ Shar
Page 49 and 50: INFORMATION ON SAMRAND 1. History a
Page 51: 6. Profit and Dividend Record The a
Page 57 and 58: vi) Facility Agreement dated 21.2.2
Page 59 and 60:
xxix) A Supplemental Deed Poll date
Page 61 and 62:
MITRAJAYA HOLDINGS BERHAD Company N
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MITRAJAYA HOLDINGS BERHAD - Announcements

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