DBE to be “formidable” affordable housing developer

KUALA LUMPUR: DBE Gurney Resources Bhd, soon-to-be-known Lagenda Properties Bhd, has received shareholders approval today for the proposed private placement of up to 135 million new consolidated shares.

The placement will enable DBE’s affordable housing development arm to be scaled up significantly.

It also received approval for the proposed consolidation of every 25 ordinary DBE shares into one DBE share, which upon completion, will theoretically adjust its share price to 75 sen, assuming its share price of three sen.

The placement represents 13.78 per cent of DBE’s enlarged issued share capital post-proposed acquisitions and after adjusting for the proposed share consolidation.

DBE said its affordable housing development arm now owns a remaining aggregate gross development value (GDV) of RM2.1 billion, unbilled sales of RM514 million together with a landbank of around 1,200 acres.

The company said to start off, it would buy two affordable township projects namely Bandar Baru Setia Awan Perdana (BBSAP) and Lagenda Teluk Intan (LTI).

DBE has acquired BBSAP Phase 1, 2 and 3 with more than 9,000 landed residential houses launched, with Phase 1 and 2 were 90 per cent sold.

For LTI, its Phase 1 of 1,850 landed residential houses are fully booked and/or sold since its launch in February last year.

Phase 2, which comprised 2,667 residential units, was launched in March this year with the remaining 1,873 residential units to be launched under Phase 3.

DBE said it would benefit from the acquisitions of both BBSAP and LTI as the demand for affordable housing was unmet by developers.

The residential units of the two townships are priced below RM200,000, which is in the range of B40 and M40 house buyers.

“The approval to the proposals will also lead to a healthier balance sheet, where RM108 million cash will be raised from the placement, based on an indicative issue price of 80 sen.

“After the acquisition, DBE’s net gearing ratio will drastically reduce from 0.6 times to merely 0.2 times post private placement,” it said.

Besides that, the company’s shareholders approved the proposed acquisitions of entire equity interest in Blossom Eastland Sdn Bhd, Rantau Urusan (M) Sdn Bhd and Yik Wang Trading Sdn Bhd for RM823.3 million.

“With the approval (of the resolutions), DBE will become one of the biggest affordable housing developers in Malaysia,” DBE managing director Datuk Jimmy Doh Jee Ming said.

“The management will now be fully focused as we streamline our business operations and work towards strengthening the group’s financial performance to the next level,” he added.

Source: NST