Photo: Keppel Corporation
Keppel Land is acquiring a 60% interest in Phuoc Kien Construction Investment from Vietnamese developer Phu Long Real Estate for VND367.5 billion ($21.6 million).
Post-completion, Phu Long will hold the remaining 40% interest in the company, which owns a plot of land located at Nha Be District, Ho Chi Minh City for which land use right certificates have been issued.
Keppel Land and Phu Long plan to jointly develop approximately 40 landed homes on the 1.5-hectare site, which is located adjacent to the existing Celesta residential project which Keppel Land and Phu Long are currently jointly developing.
The total development cost for the project, inclusive of land cost, is expected to be in excess of VND800 billion (approximately $47.1 million).
SEE:Keppel Corporation divestment gains to cushion against potential impairment on KrisEnergy: CGS-CIMB
To that end, Keppel Land has also entered into a shareholders' agreement with Phu Long in relation to their respective shareholding in Phuoc Kien and the joint development of the project
The completion of the acquisition, subject to the satisfaction of conditions precedent, is expected to take place by June.
The transaction is not expected to have any material impact on the earnings per share and net tangible asset per share of Keppel Corporation for the current financial year.
See also: Frasers Property: Narrowing the discount
Joseph Low, president (Vietnam) at Keppel Land, says the company is excited to strengthen its strategic partnership with Phu Long. “We believe that there will be strong demand for these landed homes, given their strategic location, excellent connectivity and proximity to many public amenities,” he says.
Shares in Keppel Corporation closed up 4 cents or 0.75% higher at $5.36 on May 28.
