Oxley Holdings says that its wholly-owned subsidiary, Oxley Rising Sdn. Bhd. (ORSB), has entered into a shareholders’ agreement with Kindway Express Limited (KEL) and Artisan Hospitality Sdn. Bhd. (AHSB). Under the terms of the agreement, ORSB and KEL will invest in the issued share capital of AHSB with ownership stakes of 70% and 30%, respectively.
Under the shareholders’ agreement, ORSB and AHSB are expected to enter into several agreements within 14 business days, including a sale and purchase agreement and a project agreement.
These agreements comprise the sale of 16 storeys within Tower 2 (Menara B) of Oxley Towers KLCC, which will house a luxury hotel comprising 14 floors of rooms and two floors of facilities.
The purchase consideration for the luxury hotel stands at RM250 million ($7.7 million), which is expected to be paid by AHSB within 10 business days from the receipt of approval from relevant authorities. Out of the total purchase consideration, RM175 million will be offset by ORSB against its contribution to the issued share capital of AHSB.
Under the project agreement, AHSB has appointed ORSB to procure, oversee and manage the design, execution, completion and delivery of the architectural works, mechanical and electrical works and fit-out works for the luxury hotel. ORSB will receive up to RM200 million in project costs, 70% of which will similarly be offset against its contribution to AHSB.
KEL, holding a 30% stake, is expected to make cash contributions towards its share of the purchase price and project costs. Both ORSB and KEL will also make proportional contributions toward stamp duties and charges arising from the transfer of strata titles of the luxury hotel to AHSB.
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The luxury hotel has a floor area of approximately 24,284 sqm, and is one of two hotels in the broader Oxley Towers KLCC development, which includes serviced suites, retail spaces, and an office block. The hotel is expected to be operational by Dec 31, 2027, and will be managed by Langham Hotels Management (HK) Limited under the Langham brand.
KEL, a related corporation of Langham, is set to hold a 30% interest in the hotel through AHSB.
According to the group, the proceeds from the sale of 30% interest in the luxury hotel will contribute “significantly positively” to the cash flow of Oxley Holdings 5UX .
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That said, the sale is not expected to have a material impact on the earnings per share or net tangible assets per share of the group for the current financial year ending June 30, 2025.
Shares in Oxley Holdings closed 0.2 cents lower, or down 2.44%, at 8 cents on Oct 1.
