SP Setia Bhd is acquiring five parcels of land measuring a total of 677.8ha in Seberang Perai Utara, Penang from Boustead Plantations Bhd (BPB) for RM620.12 million in cash.

In a filing with Bursa Malaysia today, S P Setia said its wholly-owned subsidiary Setia Recreation Sdn Bhd had entered into a sale and purchase agreement with Boustead Plantations for the proposed acquisition.

The proposed acquisition follows a successful bid submitted by Setia Recreation under a tender process conducted by WTW Real Estate Sdn Bhd.

The land is situated on the mainland of Penang, and it is located within the Butterworth Sungai Petani Growth Corridor with good accessibility from the North-South Highway via the Bertam Interchange.

S P Setia said that the purchase consideration is expected to be funded via the cash proceeds from the issuance of Islamic Redeemable Convertible Preference Shares by S P Setia, which was completed on Dec 6, and/or bank borrowings, the breakdown of which has not been determined at this juncture.

The property developer said the parcels of adjoining land are suitable for township development, and marks the group’s maiden entry into the mainland of Penang.

“The land is planned for the development of a mixed development township which will comprise landed and high-rise housing development and commercial components which will provide the necessary catalyst for the creation of wholesome and sustainable communities

“The group is proposing a development with a gross development value of approximately RM9.6 billion which will be fine-tuned according to the needs and closer to the time of actual commencement of each parcel in the township,” read the group’s filing.

Barring any unforeseen circumstances, S P Setia targets to launch the township development on the land in 2019/2020 and it is expected to take 15 to 20 years to complete.

Read More: TheEdgeProperty.com.my