KUALA LUMPUR (Aug 22): Malayan United Industries Bhd (MUI) is disposing of a 6.84-acre freehold land in the United Kingdom, which includes a 62-room four star hotel, for 15.1 million pounds (RM82.5 million).
The group's 61.11%-owned indirect subsidiary, Belsfield LLP, is selling the property located in Lake District National Park in North West of England to Belsfield Propco Ltd and Belsfield Opco Ltd, said MUI in a bourse filing.
MUI, which operates Corus Hotels, had launched the Laura Ashley hotel brand in 2013, with the hotel then being rebranded following an extensive refurbishment and upgrade in 2014/15. The hotel however has now dropped the Laura Ashley branding and operates as “The Belsfield Hotel”.
MUI said the net book value of the property as at Dec 30, 2021 was 4.52 million pounds or RM24.89 million, based on the exchange rate of one pound to RM5.51 at Dec 31, 2021.
Proceeds from the sale will be mainly used for the repayment of bank borrowings and related financing costs amounting to RM37.77 million, as well as payment to Jonadith UK Ltd as its entitlement as a partner of Belsfield LLP for RM26.7 million.
The remainder would be used for future business expansion (RM10.93 million), working capital requirements (RM4.43 million) and estimated expenses for the exercise (RM2.68 million).
MUI said the disposal of the property, which is expected to be completed by the first quarter of 2023, is done towards deriving potential finance cost-saving and reduction of the group’s gearing level.
This in turn will reduce the indebtedness and repayment obligation, and thereby improving the liquidity position of the group, moving forward, it said.
MUI’s share price finished unchanged at 6.5 sen on Monday, bringing it a market capitalisation of RM207.9 million.
Source: TheEdge - 23 Aug 2022
