KUALA LUMPUR: Eastern & Oriental Bhd (E&O) intends to build RM1bil worth of property investment portfolio in the next five years, now that the proposed merger with listed property arm E&O Property Development Bhd (E&O Prop) has got the go-ahead from shareholders.
Three years ago, E&O attempted to take E&O Prop private by making a voluntary general offer but the deal fell through because the latter’s minority shareholders voted against it at an EGM.
This time, the proposal received a huge approval of 99.9% in terms of shareholding value, and 80 positive votes from 86 shareholders during the court-convened meeting by E&O Prop yesterday.
E&O Prop shareholders are given three options – share swap, combination of cash and shares or maximised cash option. The merger is expected to be completed by June.
E&O managing director Datuk Terry Tham told reporters after the meeting that going forward, the group was expected “to continue to make handsome profits.”
Executive director Eric Chan said the group had identified several prime properties to form part of the property investment portfolio, which would provide recurring income to the group.
Eventually, earnings contribution between the three core businesses – property development, property investment, and hospitality and lifestyle – would be more balanced in the ratio of 60:20:20.
Currently, property development comprised more than 90% of earnings, Chan said, adding that over RM4bil worth of properties were targeted for launch within the next three years.
E&O, which owns the Delicious Group, plans to open another restaurant at the Dua Residency Annexe, Kuala Lumpur, which is also owned by E&O.
Presently, there are three Delicious and two D’lish outlets under the group in the Klang Valley.
Tham said a Delicious outlet was also anticipated to open at one of its properties in Penang.
On the recent memorandum of understanding signed with Kuwait Finance House for the development of Heritage District in the Iskandar Development Region, Chan said it was still at a preliminary stage as the involved parties had not finalised the terms.
“It is still hot from the oven. We will be looking at the details of the plan in the next couple of months,” he said.