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LHN to acquire Gul Avenue property for S$13m
CATALIST-LISTED LHN Limited is purchasing a property at Gul Avenue for S$13 million as part of its plan to expand its logistics services business, the real estate management services group announced late on Monday night.
This comes after JTC granted in-principle approval for the deal on Nov 25.
The seller is Amos Supply, whose principal activities include manufacturing wire rope slings and ship repair. Amos Supply is a wholly-owned subsidiary of mainboard-listed Amos Group Limited.
LHN intends to use the property as the parking yard for the group's logistics vehicles. The group has three business segments: space optimisation, facilities management and logistics services.
Located at 7 Gul Avenue, the property has a total land area of about 22,479.7 square metres, and a gross floor area of about 8,284 sq m. The development has a remaining lease of about 13 years, and will be sold with vacant possession on completion.
A deposit of S$650,000 has been fully paid, with the remaining balance to be paid on completion via a combination of internal sources of funds and bank borrowings. About S$1.78 million will be funded by net proceeds from the global offering of the company's shares on the main board of the Hong Kong Stock Exchange, the company said.
The sale and purchase of the Gul Avenue property is subject to certain conditions, including shareholders' approval. If approval from LHN's shareholders is not obtained on, or before Dec 27, the seller shall be entitled to forfeit the deposit, GST (goods and services tax), and all other monies paid by the company.
Controlling shareholder Fragrance Limited, which owns about 216.9 million shares, or a 53.9 per cent stake in the company has approved the acquisition.
Completion of this deal shall be four weeks from Dec 2 when the option to purchase was exercised; four weeks from the completion of decontamination works if so required by JTC; or four weeks from the rectification of any unauthorised works found on the property to be carried out by the seller, whichever is the latest date.
This deal is intended to replace LHN's earlier plan to purchase a separate property with a land area of 322,647 square feet (29,975 sq m). LHN could not proceed with the first deal because JTC did not approve the sale earlier this year. JTC said then that it intends to retain the waterfront facilities of that property for waterfront activities.
LHN shares closed at 12.8 Singapore cents on Monday, down 0.8 per cent, or 0.1 cent, before this announcement.