Jubilee to acquire 60% stake in Viridea @ Medini Lakeside for $60m

In a proposed reverse takeover.

SGX Catalist-listed Jubilee Industries Holdings Ltd (Jubilee) announced today that it plans to acquire a 60%-stake in a development project in Medini Iskandar in a proposed reverse takeover (RTO) which includes a profit guarantee from its vendor of RM180 million (approximately S$72 million).

Jubilee said that it had entered into a conditional non-binding Memorandum of Understanding (MOU) with Jewelstone Properties Ltd (Jewelstone) to acquire its wholly-owned subsidiary, Tenderside Ventures Limited (Tenderside), for a consideration of RM150 million (or S$60 million based on the agreed average exchange rate of S$1 to RM2.50 over the 12 months prior to the MOU).

Tenderside owns a 60%-stake in Viridea Lakeside Sdn Bhd (Viridea), which in turn has contracted to acquire the development project known as “Viridea @ Medini Lakeside” located in Medini Iskandar, Johor, Malaysia.

The Project, a mixed development comprising serviced apartments, retail units and SOHO apartments, is a short drive from the Second Link connecting Johor to Singapore. It is situated within Medini Iskandar, a 2,230-acre zone within Iskandar, Johor, which offers special incentives for investors.

Viridea will be developing six plots of land which is expected to yield a combined gross floor area of 1.07 million square feet over 8.2 acres of land with an estimated gross development value of approximately RM800 million (approximately S$312.5 million). The Project is expected to generate profits of RM300 million (approximately S$120 million) of which RM180 million (S$72 million) of such profits shall be declared in favour of Jubilee according to the MOU.

Jewelstone will be controlled by Singapore businessman Mr Dennis Ng. Any shortfall of the profit guarantee will be made up in cash by Jewelstone. In consideration of the acquisition of Tenderside, Jubilee is proposing to issue to Jewelstone approximately 272.7 million new Jubilee shares at 22 Singapore cents each. The Consideration Shares represent approximately 53.7% of the enlarged share capital of Jubilee of approximately 507.4 million shares.

On completion of the RTO, Jubilee will control a property developer purely focused on Medini Iskandar, which offers eligible investors certain tax and other privileges and benefits.

Mr Ng is the President and CEO of King George Financial Corporation and a Director of Allied Hotel Properties Inc. Both these companies are involved primarily in real estate and listed on Canada’s TSX Venture Exchange in Canada. Mr Ng is the son of Dato’ Ng Eng Tee, the Deputy Chairman and Executive Director of United Malayan Land Bhd, a successful and experienced developer.