Ekovest, IWCity shares surge in active trade

TheEdge Thu, Sep 17, 2020 02:01pm - 3 years View Original


KUALA LUMPUR (Sept 17): Two stocks linked to tycoon Tan Sri Lim Kang Hoo were the most actively traded counters on Bursa Malaysia this morning.

Ekovest Bhd's shares rose as much as 11.21% or 6.5 sen at an intraday high of 64.5 sen, before paring its gains to 60 sen at noon break. The counter was the most active stock on Bursa Malaysia, with some 243.51 million shares changing hands.

Iskandar Waterfront City Bhd (IWCity) also surged as much as 11.57% or seven sen to hit an intraday high of 67.5 sen, before paring early gains to 63 sen, still up 2.5 sen or 4.13% from Tuesday's closing. Some 37.05 million shares were traded, exceeding its 200-day average volume of 16.70 million shares.

The trading interest in the stocks was fuelled by the latest development on the Bandar Malaysia project.

On Tuesday, IWCity's joint venture (JV) entity IWH-CREC Sdn Bhd settled the upfront payment for a 60% stake in Bandar Malaysia.

The upfront deposit amounted to RM1.24 billion, which comprised a RM741 million deposit plus an additional RM500 million.

IWH-CREC is a 60:40 JV between Iskandar Waterfront Holdings Sdn Bhd (IWH) and China Railway Engineering Corp (M) Sdn Bhd (CREC).

In an interview with The Edge on Tuesday, Lim — major shareholder of Ekovest and IWH with 32.4% and 63% stakes, respectively — said Ekovest will acquire a 40% stake in IWH-CREC in a bid to share the fortunes of the RM140 billion-worth Bandar Malaysia project, which he expects to kick off early next year.

"I am chairman for both companies, so I have to be fair for both companies. For Ekovest to participate, it will have a direct link to jointly develop any infrastructure or development in Bandar Malaysia. This is going to be very good for Ekovest's future order book.

"With the estimated gross development value of RM140 billion for Bandar Malaysia, Ekovest must have participation with IWH together with CREC," Lim said.

According to him, the price tag for a 40% stake in IWH-CREC, which Ekovest is currently in talks to acquire, is estimated to be RM1.5 billion.

Should the negotiations bear fruit, IWH-CREC will have three shareholders, namely Ekovest (40%), IWH (20%) and CREC (40%).

Meanwhile, Reuters reported that IWH is planning to list in the first half of 2021 to raise at least RM5 billion after getting the go-ahead to start work on the Bandar Malaysia project.

The report quoted Lim as saying RM3.7 billion of the proceeds will be used to clear debt incurred from acquiring 60% of the Bandar Malaysia project alongside CREC from the Ministry of Finance.

IWH has appointed CIMB to lead its listing, while ICBC, Bank of China and CITIC are bookrunners.

Read also:

40% stake in IWH-CREC may cost Ekovest RM1.5b

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