Maxland Cancels Kedah Land Leases for Proposed Data Centre Projects

Maxland Berhad has decided to cancel two planned land lease agreements in Kedah that were intended for a proposed data centre and district cooling system project.

From this issue, I learned that companies may revise or cancel major investment projects when business strategies change. Maxland explained that after conducting a strategic review, the group found that the leased land no longer suited its future investment plans and resource allocation strategy.

The first lease agreement involved Maxland Data Sdn Bhd, an indirect wholly owned subsidiary, which had signed a 60-year lease with Kulim Technology Park Corporation Sdn Bhd (KTPC) in December 2024. The 4.57-acre land in Kulim Hi-Tech Park was intended for a data centre project and was valued at RM9.95 million.

The second agreement involved Maxland Kool Sdn Bhd, another subsidiary, which signed a separate lease in February 2025 for a 4.85-acre site within the same industrial zone. The RM10.57 million lease was meant for a district cooling system project.

I also learned that both agreements were officially cancelled through deeds of revocation signed between the subsidiaries and KTPC. Although the projects were scrapped, Maxland is expected to receive partial refunds amounting to about RM652,745 and RM743,717 after deductions and charges.

Another important lesson is that financial performance can strongly influence business decisions. Maxland’s external auditor had earlier raised concerns about the company’s ability to continue operating as a going concern after the group recorded a net loss of RM10.9 million and net current liabilities of RM29.5 million for the financial period ended Nov 30, 2025.

The company stated that it plans to strengthen its financial position through fundraising exercises such as warrant conversions and a rights issue, while also improving operational performance. As of the end of February 2026, the group only had RM1.36 million in cash and bank balances compared to total borrowings of RM16.95 million.

In addition, I learned that Maxland, formerly known as Priceworth International Berhad, is mainly involved in processed timber products as well as shipbuilding and repair services. The company also reported weaker financial performance for the first quarter ended Feb 28, 2026, mainly due to lower production volume and weak timber market conditions.

Overall, this issue taught me that companies must carefully evaluate investment projects based on financial strength, market conditions, and long-term business strategy before committing to large-scale developments.