Yong Tai Forms JV with Taghill to Develop Two Serviced Suite Blocks in Melaka
Property developer Yong Tai Bhd (KL:YONGTAI) has formed a joint venture (JV) with builder Taghill Holdings Bhd (KL:TAGHILL), previously known as Siab Holdings Bhd, to develop two blocks of serviced suites in Melaka.
The project is expected to generate RM28 million in capital entitlement for Yong Tai, which is granting Taghill's unit the exclusive rights to develop the blocks — to be known as The Dawn @ Impression City Melaka — on a plot of leasehold land measuring 2.02ha in Kawasan Bandar XLIV, Melaka Tengah, that Yong Tai owns.
In separate bourse filings on Tuesday, Yong Tai and Taghill announced that the JV is formed via Yong Tai's fully owned YTB Impression Sdn Bhd and Taghill's fully owned Taghill Land Sdn Bhd.
Under the JV deal, Taghill Land will plan, execute, manage and market The Dawn, which will comprise 648 units of serviced suites and 330 car park bays, with an estimated gross development value of RM183.31 million. In return for the use of the land, Taghill will pay YTB Impression RM28 million.
The project is set to begin in the third quarter of 2025, with completion anticipated by the fourth quarter of 2027. The project's estimated gross development value is RM183.31 million, while its estimated gross development cost is RM149.43 million, inclusive of Yong Tai's entitlement.
If the project's profit before tax surpasses RM11 million after deducting Yong Tai's entitlement, the surplus profit will be distributed at a 60:40 ratio to Taghill and YTB Impression. If the PBT falls below RM11 million, Taghill Land will gain full ownership of the project's unsold units.
“This joint venture with Taghill Land represents a decisive step in enhancing Yong Tai’s financial strength and reducing our construction risk exposure. Taghill Land’s proven expertise in property construction ensures that The Dawn will be completed swiftly, allowing us to efficiently monetise our previous investments while positioning Yong Tai for sustainable long-term growth," said Yong Tai chief executive officer and executive director Datuk Wira Boo Kuang Loon in a statement.
Yong Tai shares slipped half a sen or 3.6% to close at 13.5 sen on Tuesday, giving the group a market capitalisation of RM57.9 million. Taghill rose half a sen or 6.3% to 8.5 sen, valuing it at RM132.3 million.
$SIAB / 0241 (SIAB HOLDINGS BERHAD.)
$YONGTAI / 7066 (YONG TAI BERHAD)
Source from The Edge