Annual Report 2012 - IOI Group

DIRECTORS’REPORTSignificant Events During the Financial Year(a)Acquisition of Oil Palm Plantation by Sri Mayvin Plantation Sdn BhdOn 28 July 2011, Sri Mayvin Plantation Sdn Bhd (“Sri Mayvin”), an indirect wholly-owned subsidiary of the Company entered into aconditional sale and purchase agreement (“SPA”) to acquire 11,977.91 hectares of oil palm plantation land located in the Districtsof Labuk-Sugut, Sandakan, Sabah (“Plantation Land”) from Pertama Land & Development Sdn Bhd (“Pertama Land”), a wholly-ownedsubsidiary of Duta Plantations Sdn Bhd, which in turn, is a wholly-owned subsidiary of Dutaland Berhad (“Dutaland”) for a total cashconsideration of RM830.0 million.On 9 November 2011, both Pertama Land and Sri Mayvin had entered into a Deed of Rescission to mutually rescind the SPA withimmediate effect whereupon the parties were released from all obligations and liabilities in connection with the SPA and neitherparty shall have further claim against the other in respect thereto. Following this, the deposit of RM83.0 million earlier paid by SriMayvin pursuant to the terms of the SPA had been refunded together with all interest accrued thereon.(b)Land Tender by Multi Wealth (Singapore) Pte Ltd (“Multi Wealth”)On 16 January 2012, Multi Wealth (Singapore) Pte Ltd (“Multi Wealth”), an indirect 99.8% owned subsidiary of the Company hadbeen notified by the Housing & Development Board of Singapore of its acceptance of Multi Wealth’s tender bid for a parcel of landat Jalan Lempeng in the Republic of Singapore measuring approximately 24,417.6 square metres (equivalent to approximately 6.03acres) (“Subject Land”) for a total tender sum of SGD408.0 million (equivalent to approximately RM995.5 million). The Subject Landwith a lease period of 99 years is intended for residential development comprising condominium units.On 2 February 2012, Multi Wealth incorporated a 87.8% owned subsidiary known as Clementi Development Pte Ltd in the Republicof Singapore to undertake the development of the Subject Land and to accept transfer of the ownership of the Subject Land.(c)Establishment of USD1,500,000,000 Euro Medium Term Note ProgrammeOn 15 May 2012, the Company’s wholly-owned subsidiary, IOI Investment (L) Berhad (“IOI Investment”), a company incorporated inthe Federal Territory of Labuan under the Offshore Companies Act, 1990, established a Euro Medium Term Note Programme (“EMTNProgramme”) with an initial programme size of USD1,500,000,000 (or its equivalent in other currencies).The EMTN Programme provides the Group a further avenue to tap into the liquidity of the international debt capital markets with theflexibility to raise funds via the issuance of the notes from time to time with a tenor and in a currency to best match its requirements.Subsequent to the establishment of the EMTN Programme, IOI Investment had on 27 June 2012 issued a USD600 million 4.375%Guaranteed Notes due 2022 (“Notes”). The Notes are fully and unconditionally guaranteed by the Company and are listed on theSingapore Exchange Securities Trading Limited.110IOI CORPORATION BERHADAnnual Report 2012