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Hatten Land unit to acquire Seremban developer

CATALIST-listed Hatten Land is going beyond Melaka for the first time with its proposed acquisition of Velvet Valley Sdn Bhd, the property developer announced on Friday after the market closed.

Through subsidiary Sky Win Management Consultancy, Hatten Land has entered into an agreement to acquire Velvet Valley at a consideration of RM43 million, to be funded by the company's internal resources and/or bank borrowings. This represents a discount of about 20 per cent to its independent valuation of RM53.8 million.

Velvet Valley is currently developing the 7,936 sq m mixed development project Unicity in Seremban, Malaysia, expected to be completed in the fourth quarter of 2018. Velvet Valley also owns a completed freehold four-storey shop office with a floor area of 554.8 sq m in the central district of Seremban.

Said Hatten Land: "This acquisition is line with Hatten Land’s long-term growth strategy to diversify its portfolio outside of Melaka, and will accrue value for the company and its shareholders as another stream of recurring income."

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Velvet Valley is privately owned by Hatten Land executive chairman and managing director Colin Tan, Hatten Land executive director and deputy managing director Edwin Tan, and an unrelated third party. The proposed acquisition therefore constitutes an interested party transaction, and will be subject to shareholders' approval at an extraordinary general meeting to be convened.

Hatten Land shares closed unchanged at 13.9 Singapore cents on Friday, before the announcement.