Tropicana sells W KL hotel to IOI PFCC, Flora Development for RM270mil

Tropicana sells W KL hotel to IOI PFCC, Flora Development for RM270mil

KUALA LUMPUR: Tropicana Corporation Bhd's wholly-owned subsidiary, Tropicana Residences Sdn Bhd (TRSB), today signed a sale and purchase agreement (SPA) with IOI PFCC Hotel Sdn Bhd (IOI PFCC) and Flora Development Sdn Bhd (Flora Development) for the disposal of the W Kuala Lumpur hotel and its assets (W KL) for RM270 million.

It told Bursa Malaysia in a stock exchange filing that the disposal consideration was arrived at a willing buyer-willing seller basis, after taking into consideration the expected "net proforma gain on disposal of (about) RM7.41 million.”

"The disposal would give rise to RM270 million in proceeds, and with such proceeds, after deducting incidental expenses related to the proposed disposal, to be utilised by Tropicana to, amongst others, fully repay W KL’s existing bank borrowings and hence, improving Tropicana Group’s gearing level,” it said.

The company said the proposed disposal is not expected to have an immediate material impact on the net assets (NA) and gearing of Tropicana for the financial year ending Dec 31, 2023 as the proposed disposal is expected to be completed in the first quarter of 2024.

However, the disposal is expected to enhance the net asset of Tropicana Group in the future in view that the proceeds would be utilised to fully repay the existing bank borrowings of W KL, as well as partially repay existing bank borrowings of Tropicana Group, which would improve the gearing of Tropicana Group.

W KL comprises 25-storey, 150 hotel rooms together with hotel facilities and 346 car park bays, located adjacent to the junction of Jalan Ampang and Jalan P Ramlee, near the Petronas Twin Towers and Suria KLCC in Kuala Lumpur. - Bernama

Source: The Star