Friday, Jul 18, 2003
MARC assigned a MARC-3ID rating to Perspektif Perkasa Sdn Bhd’s (PPSB) Murabahah Underwritten Notes Issuance Facility (MUNIF) with a nominal value of RM188 million. The rating reflects the competitive position of the proposed development, Bandar Pinggiran Cyber, in terms of location, infrastructural accessibility and pricing. Despite the potentially high take-up for this proposed development, credit and liquidity risks are not mitigated as the MUNIF is not supported by secured sales. As the development will take about seven (7) to eight (8) years to complete, PPSB is also exposed to potential adverse developments in the property market.
Incorporated on 19 July 2002, PPSB is principally engaged in property development other than being an investment holding company. PPSB has an authorised capital and paid-up capital of 1,000,000 ordinary shares of RM1.00 each.
PPSB plans to undertake a mixed development project known as Bandar Pinggiran Cyber, on two parcels of land measuring 800 acres, in Mukim Dengkil, Daerah Sepang, Selangor on a joint venture basis with Expand Gain Sdn Bhd (EGSB) for 300 acres and Suzuba Development Sdn Bhd (SDSB) for 500 acres. The gross development value of the project is estimated at RM1,570 million. This proposed comprehensive and integrated township comprising single and double storey link houses, bungalows, apartments and shophouses, requires an estimated total development cost of RM1,099.49 million. PPSB expects a profit before tax of RM243.23 million by the end of the project.
Talam Corporation Berhad (Talam), through its subsidiary, Talam Builders Sdn Bhd, is the turnkey contractor for this development project. Talam is reputed in the property development industry especially for its competitive marketing techniques. Talam’s involvement from the start of the project also mitigates construction risk concerns.
Liquidity and credit risks concerns are attributable to there being no existing locked-in sales. Liquidity risk is mitigated with the requirement for a pre-fund of RM5.0 million in the DSRA, and a systematic redemption schedule over the MUNIF period.
An Option Agreement is also available under the issue structure, where bondholders can exercise a put option on Talam in the event that PPSB defaults. Should the put option be exercised, Talam shall unconditionally undertake to acquire the entire paid-up capital of PPSB and to assume the total indebtedness and ensure the completion of the project based on the fact that Talam’s Corporate Guarantee will be provided upon exercising of the Option by the Security Agent.
Incorporated on 19 July 2002, PPSB is principally engaged in property development other than being an investment holding company. PPSB has an authorised capital and paid-up capital of 1,000,000 ordinary shares of RM1.00 each.
PPSB plans to undertake a mixed development project known as Bandar Pinggiran Cyber, on two parcels of land measuring 800 acres, in Mukim Dengkil, Daerah Sepang, Selangor on a joint venture basis with Expand Gain Sdn Bhd (EGSB) for 300 acres and Suzuba Development Sdn Bhd (SDSB) for 500 acres. The gross development value of the project is estimated at RM1,570 million. This proposed comprehensive and integrated township comprising single and double storey link houses, bungalows, apartments and shophouses, requires an estimated total development cost of RM1,099.49 million. PPSB expects a profit before tax of RM243.23 million by the end of the project.
Talam Corporation Berhad (Talam), through its subsidiary, Talam Builders Sdn Bhd, is the turnkey contractor for this development project. Talam is reputed in the property development industry especially for its competitive marketing techniques. Talam’s involvement from the start of the project also mitigates construction risk concerns.
Liquidity and credit risks concerns are attributable to there being no existing locked-in sales. Liquidity risk is mitigated with the requirement for a pre-fund of RM5.0 million in the DSRA, and a systematic redemption schedule over the MUNIF period.
An Option Agreement is also available under the issue structure, where bondholders can exercise a put option on Talam in the event that PPSB defaults. Should the put option be exercised, Talam shall unconditionally undertake to acquire the entire paid-up capital of PPSB and to assume the total indebtedness and ensure the completion of the project based on the fact that Talam’s Corporate Guarantee will be provided upon exercising of the Option by the Security Agent.