KUALA LUMPUR (Oct 25): Advancecon Holdings Bhd’s 51%-owned indirect subsidiary Spring Energy Sdn Bhd (SESB) is disposing of a piece of land in Kedah to plastic packaging manufacturer Thong Guan Industries Bhd for RM34 million or RM9.95 per sq ft.  

Measuring 317,300 sq m, the freehold vacant industrial land is located in Bandar Gurun in Kuala Muda.

In a bourse filing on Tuesday (Oct 25), the earthworks and civil engineering specialist said the proposed disposal will enable Advancecon to unlock the value of its assets, thereby strengthening its cashflow position.

“The proceeds from the proposed disposal are expected to be utilised by the company and/or its subsidiaries for the repayment of some bank borrowings, as well as for working capital within 12 months from receiving the purchase price,” it added.  

The original cost of investment in the property was RM30.8 million.

Thong Guan and SESB had entered into a sale and purchase agreement for the proposed land disposal. SESB’s principal activity is as quarry operator and contractor in civil engineering works.

The land disposal is expected to be completed before Feb 28, 2023.

Advancecon’s share price closed down one sen or 3.85% at 25 sen on Tuesday, giving it a market capitalisation of RM123 million. The stock has fallen 19.4% year-to-date.