Tan Sri Lim Kang Hoo may be making another attempt to restructure his flagship property development company
PETALING JAYA: For the second time this year, Tan Sri Lim Kang Hoo will be making an attempt to restructure his flagship property development company, Iskandar Waterfront City Bhd
(IW City).
This time, the restructuring will involve Ekovest Bhd, the property development, construction and highway infrastructure arm of companies under Lim.
Sources said the primary objective of the restructuring was likely to rationalise the property assets of the group.
“At the moment IW City’s property assets are in Johor while Ekovest properties are located largely in Kuala Lumpur. It makes sense to rationalise the assets because the Johor property play is long term in nature while the properties in Kuala Lumpur have faster turnaround,” said a source.
Sources said the boards of IW City and Ekovest were having their meetings on Monday and an announcement on the restructuring was expected to be out by Tuesday at the latest.
IW City's major attraction is 6,773 acres of waterfront land in Johor Baru while Ekovest has a pocket of prime land in Kuala Lumpur that it received in return for the River of Life project.
Under the project, Ekovest is paid in land for rehabilitating sections of Sungai Gombak.
In May this year, Lim announced a major restructuring to consolidate all his property assets into Iskandar Waterfront Holdings Sdn Bhd (IW Holdings), which is the parent company of IW City.
Under the proposed deal, which did not take off, IW Holdings would take over the remaining 61.7% stake in IW City through a share swap.
However, there was poor sentiment in IW Holdings and stocks related to Lim when the government took back the Bandar Malaysia project from it in August this year.
Last year, IW Holdings together with China Railway Engineering Corp (CREC) was awarded the job to develop the 485 acres in Bandar Malaysia. The Ministry of Finance has a 40% stake in a joint venture while IW Holdings and CREC hold a combined 60%.
Looking at the technicals, there could be potential upsides to the share prices of both IW City and Ekovest.
A decisive break out of the uppermost 200-day simple moving average (SMA) of RM1.60 could see IW City rising to meet the next upper resistance at RM1.73 while concrete support is lying at the RM1.17 level.
The indicators are moving in a positive direction, suggesting a positive breakthough may be on the cards.
The slow stochastic index has crossed into a positive signal and is moving at a sharp upwards angle while the daily moving average convergence/divergence (MACD) has drifted higher above the buy signal.
WIth regards to Ekovest, the stock has been trading in range along the uppermost 200-day SMA line since Oct 16, 2017, unable to muster the trading volume to decisively breach the resistance at RM1.18.
However, on positive news, the counter could make the breakout and approach the next resistance at RM1.24.
The technical indicators have a positive bias, with the slow stochastic index angling up to give a buy signal at mid-range last Friday and the daily MACD travelling in positive territory.
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