Tan Chong International sells property, plant, and equipment for $126.3 million in call option to City Developments Limited unit

Tan Chong International Ltd, an automotive, finance, and property conglomerate, has announced the sale of its property, plant, and equipment worth $126.3 million to a unit of City Developments Limited (CDL). The deal was made through a call option, which is a financial contract that gives its holder the right, but not the obligation, to The Myst buy a certain asset at a predetermined price.

This transaction marks the first step towards Tan Chong International’s planned divestment of its automotive business in Singapore, as part of its strategic refocus on its core business in Japan, Malaysia, and the Philippines. The proceeds from the sale will be used to strengthen the Group’s balance sheet and to fund its growth in the region.

The property, plant, and equipment, which comprise the Group’s former Tan Chong Motor headquarters, located in the prime district of Novena, will be taken over by CDL’s unit, City Developments Pte Ltd. The property will be developed into a commercial, residential and retail space, with the Group planning to retain a portion of the space.

Tan Chong International’s Executive Director and Group CEO, Mr. Yee Wai Sing, stated that the sale represents a key milestone for the Group, marking the successful completion of its planned divestment of its automotive business in Singapore. He added that the proceeds from the sale will be used to fund the Group’s expansion plans in the region, including in Japan, Malaysia and the Philippines.

CDL’s Group Deputy CEO and Executive Director, Mr. Kwek Leng Beng, said that the acquisition of the Tan Chong Motor headquarters will add to the Group’s portfolio of prime properties and create value for shareholders. He added that the Group plans to develop the property into a vibrant business and residential hub, with a retail component for the benefit of the surrounding community.

This acquisition follows CDL’s earlier purchase of two properties, namely the former Mandarin Orchard Hotel and the former Mandarin Gallery, located in the prime district of Orchard Road. The Group is currently in the process of redeveloping the two properties into a retail, residential, and commercial space.

The sale of Tan Chong International’s property, plant, and equipment to a unit of City Developments Limited demonstrates the Group’s commitment to its strategic refocus, while allowing the Group to strengthen its balance sheet and fund its growth in the region. The acquisition by CDL is a strategic move that will add to the Group’s portfolio of prime properties, as well as create value for shareholders.

Tan Chong International Limited (TCIL), a diversified motor vehicle and lifestyle company, has sold its property, plant, and equipment for $126.3 million in a call option to a unit of Singapore-based City Developments Limited (CDL).

This move comes after Tan Chong International announced the divestment of its motor vehicle business in Malaysia and Singapore to a unit of CDL earlier this year.

The property, plant, and equipment were sold at a price of up to $126.3 million to a wholly-owned subsidiary of CDL, Tan Chong Motors (Singapore) Private Limited. The sale was completed on June 1, 2021.

The property, plant, and equipment includes land and buildings, engineering and automotive equipment, and other movable assets located at the former Tan Chong Motors Group’s automotive plant in JalanJelatek, Kuala Lumpur, Malaysia.

Tan Chong International has been in the Malaysian and Singaporean automotive markets for more than 60 years. During its time, Tan Chong Motors Group has been a leader in the industry, with a wide range of products, services, and activities.

The divestment of its property, plant, and equipment marks the beginning of the next chapter of Tan Chong International’s evolution. The funds generated from the sale will be used to strengthen the company’s financial position and further fuel its growth plans.

The divestment of Tan Chong International’s property, plant, and equipment marks the successful completion of the sale of its motor vehicle business in Malaysia and Singapore.

The sale of its motor vehicle business, combined with the divestment of its property, plant, and equipment, marks the successful completion of Tan Chong International’s strategic review.

Tan Chong International’s chairman, Tan Sri Dato’ Seri Liew Yuen Seng, said: “The divestment of our property, plant, and equipment is in line with our strategic review and will enable us to further strengthen our financial position and drive our growth strategy.”

He added: “We are grateful for the support of our shareholders and stakeholders in this process, and we are now looking forward to the next phase of our journey.”

The divestment of Tan Chong International’s property, plant, and equipment is a significant milestone for the company and marks the successful completion of its strategic review. The funds generated from the sale will be used to strengthen its financial position and further fuel its growth plans.