IOI aborts bid for Menara Citibank, loses deposit

IOI Corp Bhd forfeited its deposit of RM73.36mil after it aborted plans to acquire Menara Citibank for RM586.73mil.

In a statement to Bursa Malaysia yesterday, IOI Corp said the share sale and purchase agreement dated Aug 29 for the proposed acquisition became unconditional on Oct 31.

The due date for payment of the balance purchase price was Nov 11.

“However, due to the recent sudden adverse developments in the global economic environment which have spread to this region and impacted negatively on business sentiments, IOI Corp decided not to proceed with the proposed acquisition,” it said.

IOI Corp said it had received a letter from the vendors’ solicitors dated Nov 26 that they were terminating the agreement and had forfeited RM73.36mil paid earlier by IOI Corp.

The plantation group said it was seeking legal advice on the quantum of the forfeiture.

IOI Corp had proposed to acquire the entire stake in Inverfin Sdn Bhd, which owns Menara Citibank, from Menara Citi Holding Co Sdn Bhd, CapitaLand Ltd and Amsteel Corp Bhd.

IOI Corp had early announced that its earnings fell 36% to RM290.5mil due to an unrealised translation loss on its dollar-denominated borrowings of RM212.2mil. It also included a foreign exchange loss of RM100.6mil in the July-September quarter.

Meanwhile, in a statement to the Singapore Stock Exchange, CapitaLand said it would recognise a gain of S$9.3mil after IOI Corp forfeited the deposit on its failure to pay the balance on the completion date for the transaction.

By The Star