ecoWise to buy Malaysia land parcel, factory for RM13m

CATALIST-LISTED environmental solutions provider ecoWise on Wednesday morning said it is looking to buy a 2.4 hectare piece of leasehold industrial land in Malaysia together with the factory building on it for RM13 million (S$4.3 million).

ecoWise's wholly owned subsidiary, Sunrich Integrated, had entered into an option to purchase (OTP) with Rahang Rubber Industries for the proposed acquisition. The OTP expires in two weeks.

Buying the land and factory will increase ecoWise's production capacity of rubber compound and rethreaded tyres, thereby boosting its production efficiency through economies of scale, the company said.

"As ecoWise will be in the same business producing rethreaded tyres, the group does not expect the proposed acquisition to result in a change to its risk profile," it added.

The leasehold property has a remaining land tenure of about 56 years expiring on Jan 25, 2075.

It will be sold on an as-is-where-is basis, and the seller is in the process of vacating the property.

Erected on the land are a two-storey warehouse, two units of a single-storey open-side building, a canteen, a guard house and a substation.

The property is at 76A and 76B Senawang Industrial Estate, 70450 Seremban, Negeri Sembilan Darul Khusus, Malaysia.

The RM13 million consideration took into account, among other things, the property's market value of RM14 million based on a Aug 26 valuation report by Rahim & Co International.

ecoWise will finance the proposed acquisition with internal funds.

Shares of ecoWise closed at 2.1 Singapore cents on Tuesday, down 0.5 cent or 19.2 per cent.