SINGAPORE (Mar 16): Construction company Wee Hur is acquiring a plot of land at Moore Street in Canberra, Australia, for a total purchase consideration of A$29 million ($25.3 million).
Wholly-owned subsidiary Wee Hur (Buranda 2) (WHB2) has entered into a call option nomination deed with option holder Moore Canberra Property Pty Ltd ATF Moore Canberra Property Unit Trust in relation to the proposed acquisition.
Under a call option with the seller in August 2018, the option holder has the right to purchase the 1,400 sqm property for A$20 million.
Pursuant to the deed, Wee Hur will also pay a further A$9 million for the option holder to nominate WHB2 to exercise the option and enter into the contract for the sale and purchase of the property.
The full purchase consideration will be paid in cash and funded by internal resources.
The group says the proposed acquisition is in line with its strategy to venture into Australian-focused purpose-built student accommodation with the aim of collecting passive recurring rental income.
Located off-campus and some 150 metres away from The Australian National University, the title to the property is held under a crown lease for a term of 99 years, expiring on Aug 30, 2078.
It is customary in the Australian Capital Territory for crown leases to be renewed on expiry, the company says in a regulatory filing on Monday.
Wee Hur says the proposed acquisition is not expected to have a material impact on its earnings per share and net tangible assets per share for the current financial year ending December 2020.
Shares in Wee Hur closed half a cent lower, or down 2.6%, at 18.5 cents on Monday, before the announcement.
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