Eco World's explosive growth

By Sharen Kaur

TOP 20 DEVELOPER: Company to own 1,793ha generating RM43.53b in GDV, following corporate exercise

ECO World Development Group Bhd will emerge as among the country's top 20 developers, with 1,793ha land generating RM43.53 billion in gross development value (GDV), following a corporate exercise.

    The company, which is controlled by former executives of SP Setia Bhd, announced a corporate exercise yesterday that comprises two components - proposed acquisition and proposed funding.

   Its president and chief executive officer Datuk Chang Khim Wah said the exercise would conclude in October and help to raise the company's market capitalisation to about RM3 billion.

    Eco World currently has 536ha with a GDV of RM13.49 billion, and three projects in hand.

     Eco World is proposing to acquire the development rights to eight projects, with a combined GDV of RM30 billion, from the subsidiaries of Eco World Development Sdn Bhd.

     It also plans to acquire two units from Eco World Development, namely Eco World Project Management Sdn Bhd and Eco Macalister Development Sdn Bhd, which owns an investment property in Penang.

    Chang said the net consideration for the eight projects was RM1.77 billion.

    It is understood that the market value of the land for the eight projects, which totals more than 1,200ha, is RM3.78 billion.

    Eco World plans to issue 806.84 million new shares to raise RM1.37 billion and a rights issue to raise RM788 million to fund the acquisitions and as working capital for its development activities.

    It is also proposing a subscription of shares in Eco World by shareholders of Eco World Development.

   Chang said following the completion of this exercise, Eco World will become a property player for all sectors.

    "We will have affordable homes, semi-detached and terraced houses, bungalows, high-rise residences, townships, commercial centres, and business and industrial parks," he said at a media briefing here, yesterday.

    Chang also said the corporate exercise would not affect the company's performance in the financial year ending October 31.

     "This exercise will allow us to achieve explosive growth for the next eight to 10 years as we integrate all the development projects of the unlisted entity into the listed company," he said.