UALA LUMPUR: Malaysia Pacific Corp Bhd’s (MPCorp) plan to strengthen its financial position, thereby lifting its Practice Note 17 status, has met another setback. The second potential buyer of Wisma MPL has backed out of the deal.
In a filing with Bursa Malaysia, the property development and investment firm said Zitron (M) Sdn Bhd, which on Aug 17 gave a letter of intent to purchase the 22-storey office complex in Kuala Lumpur, had decided not to proceed with the transaction.
“The refundable earnest deposit of RM5mil which is currently held by the company’s stakeholder shall be remitted back to the potential buyer’s solicitors within seven days,” it said.
Earlier, on July 28, MPCorp had signed a memorandum of understanding (MoU) with a different company, Singapore-incorporated Terra Pontus Pte Ltd, for the proposed disposal of part of Wisma MPL owned by the company for RM250mil.
According to MPCorp’s annual report, Terra Pontus failed to make the required RM5mil earnest deposit and MPCorp terminated the MoU on Sept 9. The following week, MPCorp accepted an earnest deposit from Zitron.
MPCorp has been identifying prospective buyers for its investment property, Wisma MPL, and/or its landed properties in Johor Baru, as a long-term solution to resolve its default in repayment of outstanding banking facilities to RHB Bank Bhd and other creditors.
In March 2013 MPCorp announced it had defaulted in repaying principal sums and interest for banking facilities provided by RHB Bank, with the amount outstanding as at Jan 31, 2013, being RM97.5mil.
MPCorp recorded a bigger group pre-tax loss of RM88.4mil for the financial year ended June 30, 2016 (FY16), compared with a loss of RM16mil in the preceding year.
This higher loss was mainly attributed to the impairment losses on assets held for sale.
Based on the annual report, the group incurred an impairment loss of RM70mil on Wisma MPL, which was classified under assets held for sale during FY16.
MPCorp was given by Bursa Malaysia Securities a time extension until Dec 29, 2016, to submit its regularisation plan to the authorities.
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