IOI to start China project next year

PUTRAJAYA: IOI Corp Bhd, an esteemed property developer in Malaysia and Singapore, will embark on a RM2 billion property development in China next year.

"We've bought a piece of land in the Jimei district of Xiamen for 1.2 billion yuan (RM587 million). We have plans for a mixed development comprising a shopping mall, a hotel and office space. The residential space will be in the form of condominiums and villas," said IOI Corp Bhd executive chairman Tan Sri Lee Shin Cheng.

"The development cost would be around twice the cost of the land," he told reporters yesterday after its shareholders' meeting here yesterday. Also present were his sons Datuk Lee Yeow Chor and Lee Yeow Seng, who are executive directors.

Yeow Chor said about RM600 million of IOI Corp's cash reserves of RM2.7 billion has been committed to finance the land cost in Xiamen.

"Our cash reserves is not too high or too low at the moment. Should there be some good landbank acquisition opportunities, we have the financial might to seize it," he said.

As early as 2007, IOI invested US$62.63 million to take up a 33 per cent stake in PT Bumitama Gunajaya Agro. This was part of its plan to participate in Indonesia's oil palm expansion and ensure upstream profit growth.

Today, Bumitama has an agriculture landbank of some 200,000ha in Indonesia, of which some 120,000ha are already planted up with oil palms. Of that total area, 87,851ha are held under the company and 31,311ha under the smallholders or plasma schemes. Currently, IOI Corp has a 30 per cent stake in Singapore Stock Exchange-listed Bumitama Agri Ltd.