We refer to your Company's announcement dated 24 March 2026, in respect of the aforesaid matter.
In this connection, kindly furnish Bursa Securities with the following additional information for public release:-
It is noted that OCR Avenue Sdn Bhd ("OCR Avenue") and Magna Ecocity Sdn Bhd ("MESB") had, on 20 April 2022, entered into a Joint Venture Agreement ("JV Agreement") whereby OCR Avenue and MESB were supposed to assume the role as Developer and Owner respectively for the development of the Land (20 acres in area).
Given the backdrop of this JV Agreement and to give a proper context to the proposed disposal of 4.58 acres sub-divided sale land by OCR Avenue to MESB, please provide the following additional information:-
1) To provide a clear and detailed clarification on how the joint venture between MESB and OCR Avenue established in 2022 pursuant to the JV Agreement has evolved into the current proposed disposal of the Sale Land by OCR Avenue given that MESB is the registered and beneficial owner of the Land. In this respect, please also include details and explanation on the progress/implementation or deviation pertaining to the following step taken or proposed to be taken to address the key audit matter that related to the material uncertainty to going concern, as disclosed in MAGNA's announcement dated 29 April 2022 in relation to the 'Unqualified Opinion with Material Uncertainty Related to Going Concern in the Audited Financial Statements for the Financial Year Ended 31 December 2021':
"One of the subsidiary of the Group, Magna Ecocity Sdn Bhd has entered into a joint venture agreement on 20th April, 2022 to develop the land commonly known as Lot PT 12, Shah Alam measuring 20 acres wherein the Company will receive not less than RM160 million under the Agreement, the first RM80 million of which will be due within six months from the date of the Agreement. The amount received will be primarily used to pare down the Group's borrowings and the subsequent payment will be due and payable within the next three years on an annual basis. The arrangements will therefore alleviate the Group's financial predicaments."
2) To clarify if the JV Agreement is still subsisting. If yes, please provide the following information:
- The last date of fulfilment of all the conditions precedent of the JV Agreement i.e. the Unconditional Date of the JV Agreement;
- Details of the development project, of which the relevant information shall be provided in the manner specified under Paragraph 4, Part C, Appendix 10A of the Main Market Listing Requirements;
- The total costs/expenses already incurred by each of the JV party i.e. OCR Avenue and MESB/MAGNA respectively to jointly develop the Land; and
- If the development of the Land has commenced as planned, please explain why the Land remains vacant as to-date.
3) In the event the JV Agreement has been terminated, please state the date of such termination and the reasons/factors leading to such termination as well as details on any penalty/compensation arising from the termination.
4) To provide further information on the Land, including the terms of the tenure, expiry date of the lease under the Title and net book value based on the latest audited financial statements.
5) To provide the factors of consideration that have been taken into account to justify the current Purchase Price of RM225.56 per square foot by OCR Avenue which represents an increase of RM41.91 per square foot or approximately 22.8% from the previous valuation of approximately RM183.65 per square foot undertaken pursuant to the JV Agreement. In this respect, please also clarify how could the Board ensure that the Sale Land is fairly price and how the proposed transaction is carried out in the best interest of MESB/MAGNA given that there is no formal/proper valuation being carried out on the Land/Sale Land.
6) To provide the conditions precedent, termination and relevant penalty clauses of the Sale and Purchase Agreement dated 24 March 2026.
7) To show the financial effect on the gearing before and after the acquisition by Twinicon of the Sale Land assuming the Purchase Price of RM45 million will be fully funded by the bank borrowings.
8) In view that the Purchase Price will be funded from internally generated funds and bank borrowings, please include a write-up on the potential funding risk together with the relevant mitigating factors.
Please furnish Bursa Securities with your reply within one (1) market day from the date hereof.
Yours faithfully,
Listing
Group Regulation
Cc : Market Surveillance Dept. , Securities Commission Malaysia