Equine Capital disposes of PGCC developer Abad Naluri

The PGCC coffin has been lowered into its final resting place. Equine Capital has sold its 25 per cent stake in Abad Naluri, the developer of the aborted Penang Global City Centre project, to Kiara Ikhtisas Sdn Bhd for RM2 million. This comes a couple of weeks after Patrick Lim stepped down as chairman and executive director of Equine Capital (though he still controls about 28.9 per cent of Equine). Equine now appears to have come under new management, especially in its projects side.

This Kiara Ikhtisas sounds like an ‘interesting’ company – reportedly registered earlier this year with its shareholders being Zainudin Koming and Noraini Abdullah (see report below).

Remember, the Penang Turf Club land deals and the 1,000 acres Batu Kawan land agreement were entered into with Abad Naluri, not Equine Capital. This means Kiara Ikhtisas/Abad Naluri – along with the land deal vendors, Penang Turf Club and Penang Development Corporation (re the Batu Kawan land bank) – will now have to decide what to do with these deals. At any rate, Penangites will be watching very closely to see what happens now to these two plots of land.

This article from The Edge Daily:

21-10-2008: Equine sells Abad Naluri
by Jose Barrock

KUALA LUMPUR: Property developer Equine Capital Bhd has disposed of its 25% stake in Abad Naluri Sdn Bhd for RM2 million cash to privately held Kiara Ikhtisas Sdn Bhd.

Abad Naluri was the company given the mandate to develop the controversial RM20 billion Penang Global City Centre (PGCC) project, which was shelved when the ruling coalition Barisan Nasional lost Penang state.

Checks with the Companies Commission of Malaysia show that Kiara Ikhtisas was registered end-April this year with an authorised capital of RM500,000. Its directors are Mejar Jeneral (Rtd) Datuk Sulaiman Kudus, Mohamed Fadzil Mohamed Ariffin and Shahrin Osman.

The company’s shareholders are Zainudin Koming and Noraini Abdullah, who control the company equally.

Both the individuals are also shareholders in Gubahan Saujana Sdn Bhd which, together with LSG Asia GmbH and Fahim Capital Sdn Bhd, acquired LSG Sky Chefs-Brahim’s Sdn Bhd (formerly known as MAS Catering Sdn Bhd) for RM175 million in 2003. Gubahan Saujana is reported to have a 25-year concession to supply in-flight catering for the national flag-carrier.

The duo’s plans for Abad Naluri are not clear. Datuk Ibrahim Ahmad Badawi, the brother of Prime Minister Datuk Seri Abdullah Ahmad Badawi, was once a director of Gubahan Saujana.

Previously, there was speculation that officials of property developer Malton Bhd, in particular its managing director Datuk Lim Siew Choon, were interested in taking over Equine, but this remains unsubstantiated.

It is also noteworthy that the acquisition comes shortly after Equine’s controlling shareholder Datuk Patrick Lim Soo Kit stepped down as chairman and executive director about two weeks ago. Lim still controls about 28.9% of Equine.

According to Equine’s announcement to Bursa Malaysia, its cumulative cost of investment in Abad Naluri was RM4 million and the company had net assets of RM765,679 and recorded a loss after tax of RM3.9 million for the financial year ended March 2008.

“In view of the rejection of Abad Naluri’s proposed development plans for the PGCC by Majlis Perbandaran Pulau Pinang, Abad Naluri is not expected to generate any positive contribution to the earnings of Equine in the near future,” Equine said in its announcement.

Equine, meanwhile, posted a net profit of RM26,000 on the back of RM28.3 million in revenue for its first financial quarter ended June this year.

Year-to-date Equine has shed about 85% of its value and closed at 33 sen yesterday.

The PGCC project was a much-talked-about multi-billion-ringgit development project on Penang island. It was Patrick Lim’s biggest coup in his corporate heyday as he managed to stave off competing bids from corporate big guns such as T Ananda Krishnan and Tan Sri Vincent Tan to win the rights to develop the turf club land.

However, the project came under much criticism despite getting all approvals and was the target of DAP’s political campaign against the Barisan Nasional in the state. Hence when there was a change in the state government, the project could not make any progress.