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09-04-15, 23:56
http://www.straitstimes.com/archive/thursday/premium/money/story/singhaiyi-sells-stake-developer-housing-project-20150402
SingHaiyi sells stake in developer of housing project
Move prompted by 'very slow' sales and possible levy on unsold units
Published on Apr 2, 2015 1:00 AM
By Jacqueline Woo
CATALIST-LISTED SingHaiyi Group is selling its majority stake in Corporate Residence, the developer of City Suites in Balestier Road, for $16.38 million.
Its 90 per cent interest in the developer will be sold to Ang Cheng Guan Construction, the main contractor of City Suites.
The remaining 10 per cent is held by Corporate Space.
SingHaiyi said in a filing to the Singapore Exchange yesterday that sales at the 56-unit private freehold residential project have been "very slow" - only about 10 per cent since its launch in May 2013.
"In view of the possible levy as a result of the qualifying certificate (QC) on unsold units, it is in the interest of the company to sell (Corporate Residence)."
Under the QC rules, foreign developers, or those whose directors and shareholders are not all Singaporeans, have to pay an extension fee if they fail to sell their units within two years of the project's completion.
SingHaiyi is not the first to avoid paying the heavy penalty for its unsold private homes by selling them to a privately held Singapore company.
Just last week, Hiap Hoe Holdings completed its acquisition of all the shares in its subsidiary Hiap Hoe SuperBowl for $185 million.
It had failed to sell any of the 48 units in Treasure on Balmoral, a high-end District 10 project, since its launch in September 2012.
SingHaiyi said yesterday that Corporate Residence, which had $11.3 million in net tangible liabilities as at Feb 28, will cease to be a subsidiary of the company once the sale is completed.
It added that the sale proceeds will be used for its working capital.
The sale is not expected to have any material effect on the group's consolidated net tangible assets per share or the consolidated earnings per share for the financial year ended March 31.
SingHaiyi shares closed unchanged yesterday at 15.2 cents.
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SingHaiyi sells stake in developer of housing project
Move prompted by 'very slow' sales and possible levy on unsold units
Published on Apr 2, 2015 1:00 AM
By Jacqueline Woo
CATALIST-LISTED SingHaiyi Group is selling its majority stake in Corporate Residence, the developer of City Suites in Balestier Road, for $16.38 million.
Its 90 per cent interest in the developer will be sold to Ang Cheng Guan Construction, the main contractor of City Suites.
The remaining 10 per cent is held by Corporate Space.
SingHaiyi said in a filing to the Singapore Exchange yesterday that sales at the 56-unit private freehold residential project have been "very slow" - only about 10 per cent since its launch in May 2013.
"In view of the possible levy as a result of the qualifying certificate (QC) on unsold units, it is in the interest of the company to sell (Corporate Residence)."
Under the QC rules, foreign developers, or those whose directors and shareholders are not all Singaporeans, have to pay an extension fee if they fail to sell their units within two years of the project's completion.
SingHaiyi is not the first to avoid paying the heavy penalty for its unsold private homes by selling them to a privately held Singapore company.
Just last week, Hiap Hoe Holdings completed its acquisition of all the shares in its subsidiary Hiap Hoe SuperBowl for $185 million.
It had failed to sell any of the 48 units in Treasure on Balmoral, a high-end District 10 project, since its launch in September 2012.
SingHaiyi said yesterday that Corporate Residence, which had $11.3 million in net tangible liabilities as at Feb 28, will cease to be a subsidiary of the company once the sale is completed.
It added that the sale proceeds will be used for its working capital.
The sale is not expected to have any material effect on the group's consolidated net tangible assets per share or the consolidated earnings per share for the financial year ended March 31.
SingHaiyi shares closed unchanged yesterday at 15.2 cents.
[email protected]