KUALA LUMPUR (July 4) — Eonmetall Group Bhd is seeking shareholder approval for the proposed disposal of two freehold industrial land parcels in Kapar, Klang, for RM273.28 million as part of its strategy to strengthen its balance sheet and support future business expansion.
The proposed transaction will be carried out through its wholly owned subsidiary, Eonmetall Land Sdn Bhd, which has agreed to sell the land to WG Malaysia VIII Sdn Bhd for cash consideration.
The two adjoining parcels, located in Mukim Kapar, Klang, cover approximately 26.723 hectares and are zoned for medium industrial use. The land is currently vacant and is charged to Bank of China Malaysia Bhd, with the titles also subject to a private caveat lodged by the bank.
Disposal Price Reflects Market Value
The agreed selling price of RM273.28 million was negotiated on a willing buyer-willing seller basis, equivalent to approximately RM95 per square foot.
The consideration closely matches an independent valuation conducted by Savills (Malaysia) Sdn Bhd, which assessed the property's market value at around RM273 million. The valuation adopted the comparison approach and considered the land's highest and best use, particularly its potential for data centre and information technology infrastructure developments.
Proceeds to Strengthen the Business
Eonmetall plans to allocate the disposal proceeds across several key areas to enhance its financial position and support future growth.
More than RM108 million will be used to repay existing borrowings, substantially reducing the group's debt burden. Another RM86.28 million has been earmarked for working capital, while RM60 million will be reserved for future acquisitions of businesses or strategic assets.
The remaining proceeds will be utilised to cover transaction-related expenses, including real property gains tax.
Positive Financial Benefits Expected
Based on pro forma financial estimates, the disposal is expected to generate a net gain of approximately RM46.30 million attributable to shareholders.
The transaction is also projected to improve the group's financial health by increasing its net assets per share from RM0.82 to RM0.86 while significantly reducing gearing from 0.65 times to just 0.02 times following debt repayment.
These improvements are expected to provide Eonmetall with stronger financial flexibility and capacity to pursue future investment opportunities.
Related-Party Transaction to Be Voted On
The proposed disposal is classified as a related-party transaction under Bursa Malaysia's Main Market Listing Requirements due to the involvement of certain directors, major shareholders and connected persons.
An Extraordinary General Meeting (EGM) will be held on 20 July 2026 at Wisma Leader Steel in Bukit Tengah, Penang, where non-interested shareholders will vote on the proposal.
Independent adviser WYNCORP Advisory Sdn Bhd has concluded that the transaction is fair, reasonable and not detrimental to the interests of non-interested shareholders, recommending that shareholders approve the proposal.
Industry Insight
The proposed disposal reflects the growing demand for industrial land suitable for data centres and digital infrastructure as Malaysia continues to attract technology-related investments. It also demonstrates how companies can unlock the value of undeveloped land, improve financial strength and recycle capital into new business opportunities while maintaining strong corporate governance through independent assessments and shareholder approval.
Key Takeaways
This article helped me understand how companies can monetise valuable industrial land to improve their financial position while preparing for future growth. I learned that independent property valuations ensure disposal prices reflect fair market value, especially when land has strong development potential for sectors such as data centres and information technology. The article also shows that proceeds from asset disposals can be strategically allocated to reduce debt, strengthen working capital and fund future acquisitions. Most importantly, I learned that related-party transactions require independent advice and shareholder approval to ensure transparency, fairness and the protection of minority shareholders.
Yao Mu Realty, based in Kuala Lumpur, Malaysia, specializes in industrial real estate for factories and land, delivering professional and efficient solutions.
Posted by Yao Mu Realty Sdn Bhd on 5 Jul 26
Malaysia