SLB Development, Oxley bag freehold Pei Fu Industrial Building in S$76.25m collective sale

NEWLY-listed SLB Development announced on Tuesday that subsidiary Oxley Kyanite has exercised the option to acquire freehold Pei-Fu Industrial Building for a total of S$76.25 million.

The transaction price, reported earlier by The Business Times, surpasses the reserve price of S$75 million, and works out to S$489 per square foot per plot ratio (psf ppr), based on the proposed gross floor area (GFA) of 155,864 square feet (sq ft).

This unit land rate does not include a development charge that may be payable to the state, as the development baseline has yet to be ascertained.

The acquisition - brokered by William Gan Realty - was undertaken by Oxley Kyanite Pte Ltd, in which SLB has an indirect 51 per cent interest with mainboard-listed Oxley Holdings owning the remaining 49 per cent share.

The six-storey flatted factory, located at 23 New Industrial Road, has a land area of around 62,346 sq ft and was completed around the early 1980s. It was developed by Tay Eu Chee Realty Pte Ltd, which owns a substantial portion of the 30 strata units in it.

SLB, the property spin-off of construction company Lian Beng, said that it intends to redevelop the site, subject to obtaining all necessary approvals from the relevant authorities, and will fund the purchase using internal resources and external borrowings.

The Catalist-listed company has already paid a deposit of S$3.81 million, with a similar sum payable upon consent of the sale by the Strata Titles Boards or the High Court, and the remainder on legal completion of the purchase.

Owners which control some 88.5 per cent of both strata area and share value in the development have given their nod to the collective sale, BT reported earlier.

If Oxley Kyanite fails to obtain the requisite consent, approval and clearance for the sale, the vendors shall be entitled to rescind the sale and purchase and recover any damages suffered, Oxley noted.

SLB said that the acquisition is not expected to have any material impact on the group's net tangible assets per share and earnings per share for the current financial year ended May 31, 2018.

As at 3.19pm, SLB shares were trading at S$0.235 apiece, down S$0.01 or 4.08 per cent, while Oxley's counter was flat at S$0.485.