MRCB’s 80% buyout in Bukit Jalil Sentral Property from EPF deemed 'fair and reasonable"

PETALING JAYA: An independent adviser has advised Malaysian Resources Corp Bhd’s (MRCB) shareholders to vote in favour of the RM1.58bil cash purchase of the remaining 80% interest in Bukit Jalil Sentral Property Sdn Bhd (BJSP) from the Employees Provident Fund (EPF).

In a circular filed with Bursa Malaysia, Kenanga Investment Bank Bhd (Kenanga IB) said the proposed acquisition is fair, reasonable and not detrimental to the interests of the non-interested shareholders of MRCB.

Kenanga IB said the purchase consideration of RM1.58bil represents a slight premium of RM5.1mil or approximately 0.32% over the valuation for the sale shares of RM1.57bil as assessed by the independent valuer, KPMG. Nonetheless, it is of the view that, notwithstanding the slight premium, the proposed deal is “fair” and “reasonable”.

In September this year, MRCB said the buyout came as it re-evaluates the approved mixed development plan from November 2020. At that time, the group said discussions with the EPF on revising the original masterplan were unsuccessful, leading MRCB to proceed with the buyout.

BJSP had been established to undertake the 76.14-acre Bukit Jalil Sentral project, which has a projected gross development value of RM21bil.

In the filing then, MRCB said the lands can serve “as an enlarged hub to the Malaysian Research Accelerator for Technology and Innovation (MRANTI) Park.

The lands are located about 1.9km from the MRANTI Park in Bukit Jalil, a “prime venue for the establishment of hyperscale data centers, offering critical infrastructure for large-scale cloud computing and data storage”.

The group also noted that “with the escalating demand for such facilities, data center operators are actively exploring nearby alternative lands, thereby significantly enhancing interest in the lands”. Nonetheless, MRCB added it will conduct feasibility and environmental studies before embarking on the development of any data centers on the lands.

BJSP owns three pieces of land with the first being a 97,720 sq metre-recreational park. The other two are empty lands, with an area of 37,320 sq metres and 173,800 sq metres respectively.

Expected to be funded entirely through external borrowings, the proposed acquisition will give MRCB full control over the entire development of the lands which has a market value of RM2.06bil, whilst allowing the EPF to exit its investment in BJSP. The deal is deemed a related party transaction as the EPF owns about 36% stake in MRCB.

Kenanga IB said the acquisition includes the 1.13bil BJSP RPS-A which carries a dividend rate of 7% per annum in perpetuity. It also highlighted the proximity of the lands from the MRANTI Park, apart from the lands being well-connected by major highways and public transportation, including proximity to LRT and MRT stations such as the Sri Petaling LRT, Bukit Jalil LRT and Sungai Besi MRT stations.

Moreover, Kenanga IB said the prospects of the proposed acquisition should be “generally positive due to the encouraging outlook of the Malaysian economy as well as the property sector”.

MRCB reiterated that it is currently assessing and considering the feasibility of developing data centres on all or part of the lands. As the assessment is still at a preliminary stage and involves various technical, commercial and regulatory considerations that require further analysis, the company said the expected timeline to complete the feasibility study to develop data centres cannot be determined at this juncture.

The Extraordinary General Meeting of MRCB will be held on Dec 18, 2025, where shareholders shall vote on the proposal.