L&G to Revive Bandar Sungai Buaya and Lembah Beringin
L&G have been prominently mentioned in the business papers recently. They are currently undergoing a restructuring exercise, with a debt valued at about RM488mil as of at the end of last year. Their financial problems have been highlighted here In Property Malaysia before (you can check it out here).
The company is looking to revived two of their stalled townships, Bandar Sg. Buaya and Lembah Beringin. These two projects are held under the company’s respective subsidiaries, and were hit during the 1997-98 Asian financial crisis. However, how the company plans to do so is unclear. Currently they are looking at a few options, such as JV with other parties or offloading some land to raise cash, but nothing is decided yet.
According to a report, The group posted a net loss of RM129.5 million for the year ended March 31, 2005 mainly due to the impairment of assets and liquidated ascertained damages in the two subsidiaries.
Further to that, during the recent EGM:
- The company will sell off two plots of land in Sungai Buloh, Selangor, to TA Enterprise Bhd’s unit Indo Aman Bina Sdn Bhd for RM189.55 million as part of its debt restructuring agreement (DRA) with its creditors.
- The DRA, which is in effect from 2003 to 2010, will see it selling off specified assets to reduce about RM742 million in debts and forbids it from further borrowings. This leaves the company with a land bank of more than 5,000 acres.
During the height of the boom time when both Lembah Beringin and Bandar Sg. Buaya were launched, many city folks viewed the two projects as too far from the city and the other suburbs, making it less attractive as compared to other competing developments. If L&G plans to really make good revenue from resurrecting these two projects, they have an uphill task ahead of them. Furthermore, they have also to consider the economic climate of the property market in the coming months.
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