KUALA LUMPUR: Bonia Corp Bhd has scrapped its plan to sell its wholly-owned unit Maha Asia Capital Sdn Bhd to its founder, chief executive officer (CEO) and group executive director Chiang Sang Sem for RM2.49 million, citing certain conditions precedent in the share sale agreement (SSA) that have not been fulfilled as a reason.

Maha Asia is principally a property investment company, where its principal asset is a freehold land measuring 1,403.74 sq m, together with a single-storey bungalow in Jalan Delima here valued at RM24 million as at April 18, 2018.

It is currently used as a car park.

Bonia had on May 8, 2018 signed a SSA with Chiang for the proposed disposal, which was deemed a related-party transaction in view that Chiang owned 46.81% of Bonia.

At the time, the market value price of the Maha Asia Property was RM26 million, which was above its market value of RM24 million. The net book value of Maha Asia was RM21 million as at June 30, 2017, while the original investment cost was RM19.9 million.

Bonia said the proposed disposal was to enable it to divest Maha Asia Property at a premium to the market value and realise a net gain on disposal of RM4.82 million. At the same time, Bonia was also to receive an estimated RM15 million cash inflow, which would have enabled the group to pare down its bank borrowing and reduce its gearing.

In a bourse filing yesterday, Bonia said both parties have mutually agreed to terminate the SSA.

"The deposit of RM249,099, being the sum equivalent to 10% of the purchase price paid by the purchaser to the vendor, will be refunded," it added.

Bonia shares closed unchanged at 23.5 sen yesterday, bringing a market capitalisation of RM185.51 million.