IOI denies buy of RM900m neighbouring estate

KUALA LUMPUR: IOI Corp Bhd shot down rumours that it is in talks to buy Achi Jaya Plantations Sdn Bhd's 12,074ha oil palm plantation in Labis, Johor, for RM900 million.

"As far as I know, it's not true," executive chairman Tan Sri Lee Shin Cheng said.

Two months ago, an online portal cited an unidentified source claiming that Achi Jaya Plantations, which neighbours IOI Corp's estates in Johor, had been put up for sale for a while.

Achi Jaya Plantations (formerly Achi Jaya Services) acquired Socfin Plantations Sdn Bhd's assets comprising 12,074ha oil palm estate, workers' quarters, staff and executive bungalows, a clubhouse, a nine-hole golf course, a 60-tonne oil mill and other facilities and amenities for RM512.16 million in January 2004.

Meanwhile, IOI Corp had announced last month that it plans to spin off and relist its property division on the stock market. 

It will do so by injecting its property development, real estate investments, land and other related businesses into IOI Properties Group Sdn Bhd in exchange for shares in IOI Properties. It will also distribute one share in the new unit for every three held by existing shareholders. 

When asked on the progress of this plan, Lee smiled and said IOI Corp shareholders are poised to benefit from lower entry price in its property division. 

"The property business is on a stronger footing now with more valuable assets. We have built up the property landbank in strategic locations, so it is about time we unlock its value," he said.

Since IOI ventured into Singapore and China in 2011 and 2012, it has been rebranding itself. It is no longer just a township developer and is moving towards becoming a high-end condominium and commercial developer. 

This effort is seen in its appointment of world-renowned Sir Norman Foster as the architect for its South Beach development in Singapore.

Analysts estimated the share sale of the soon-to-be relisted company to raise as much as RM10 billion.

This is a huge improvement in size, considering that it was only in 2009 that IOI Corp had taken private its then-listed property arm, IOI Properties Bhd, for a mere RM310 million in cash and shares, valuing the unit at about RM1.3 billion.