The Lian Beng Group is buying a freehold industrial building now held by Food Empire Holdings for $49.25 million.
The 11-storey building, at 31 Harrison Road, has a gross floor area of 4,890.24 sqm and is now fully tenanted.
With the sale, Food Empire, which has seen the value of this asset appreciate over the years, will book a gain of around $20.54 million.
Food Empire will see its NTA per share increase from 40.46 cents to 43.12 cents upon completion of the deal.
It calls the sale part of its efforts to rationalise its businesses and that it deems the ownership of this property non-core.
As for Lian Beng, the acquisition is line with one of its core business activities in property investments.
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“The group views the proposed acquisition as a good opportunity to participate in a strategic investment of the property, where the group can derive rental returns which will be added to the earnings of the group,” says Liang Beng.
In an earlier announcement, SLB Development, the separately listed subsidiary of Lian Beng, has announced plans to buy two adjacent shophouse units along North Canal Road for $14.38 million and an office building in Melbourne for A$35.5 million.
Lian Beng shares closed on June 9 at 52 cents, down 1.9% for the day.
Food Empire shares closed at 54 cents, up 1.9%.
