Tien Wah Press unit to buy East Java factory site for RM34.07m
PT Bintang Pesona Jagat, an indirect 51%-owned subsidiary of Tien Wah Press Holdings, will acquire five parcels of land and buildings in Malang, East Java, for IDR150 billion (RM34.07 million) cash. The purchase secures long-term ownership of its leased production facility, with completion targeted
PETALING JAYA (Oct 2): Tien Wah Press Holdings Bhd's indirect 51%-owned subsidiary PT Bintang Pesona Jagat (BPJ) plans to buy five parcels of land and their buildings in Malang, Indonesia, for IDR150 billion (about RM34.07 million) cash to secure long-term ownership and use of its existing production premises.
In a Bursa Malaysia filing on Thursday (Oct 1), Tien Wah Press said BPJ had entered into a binding sale and purchase agreement that day with PT Bentoel Prima for the properties, which span approximately 23,393 sq m. BPJ, which provides tobacco-packaging printing and general packaging services, currently leases the factory from the vendor for IDR513.99 million (about RM116,750) a month, payable quarterly.
The group said the acquisition would allow BPJ to continue operating from the facility upon expiry of its existing tenancy arrangements, avoiding substantial relocation costs and potential operational disruption. The properties are at Jalan Perusahaan No. 48, Banjararum Village, Singosari District, Malang Regency, East Java. They comprise factory and office premises, with buildings approximately 15 to 19 years old.
The five parcels carry land identification numbers 12.30.000101736.0, 12.30.000101741.0, 12.30.000029190.0, 12.30.000126826.0 and 12.30.000101738.0. They are held under Hak Guna Bangunan (HGB), or building-use rights, titles expiring between 2041 and 2045. Tien Wah Press said the titles are generally eligible for extension and subsequent renewal, subject to compliance with applicable laws and approval by the Indonesian Land Office.
The purchase price is about 8.9% below the independent market valuation of IDR164.65 billion (about RM37.40 million) as at Aug 25, 2025. The valuation was undertaken by KJPP Yufrizal, Deny Kamal dan Rekan using the cost method, with its report dated Sept 19, 2025. The group said the price was negotiated on a willing-buyer, willing-seller basis, taking into account the valuation and the site's location, tenure, existing use, condition and size, as well as its strategic importance to BPJ and potential relocation costs and disruption.
The IDR150 billion consideration excludes IDR16.5 billion in value-added tax. BPJ is to pay IDR15 billion upon execution of the agreement, followed by IDR150.91625 billion before or on the same date as execution of the formal deed of sale and purchase, known as the Akta Jual Beli (AJB). According to the filing, the second payment is net of deductions of IDR340 million for land-certificate consolidation fees and IDR243.75 million in notary fees. The AJB is to be executed after completion of the boundary-adjustment process for HGB Certificate No. 1024/Banjararum Village.
The acquisition will be funded through internally generated funds and/or bank borrowings. PT Bank OCBC NISP Tbk has offered BPJ a 10-year term loan of up to IDR120 billion to partly finance the purchase, carrying a floating interest rate of 7.5% a year. Tien Wah Press said the acquisition would also support BPJ's participation in a BAT tender for a proposed five-year supply contract covering 2027 to 2031. The site is opposite BAT's factory, which the group said would improve logistics efficiency.
BPJ intends to consolidate certain land titles after completion. However, the parcel under Certificate No. 1024 cannot be consolidated with the other titles because it is separated by public drainage owned by the local government. The group cautioned that there is no assurance the intended consolidation would be completed within the expected timeframe or without additional costs. BPJ would also face higher financing costs if the floating interest rate rises.
The acquisition is expected to be completed by Dec 31, 2026, subject to the agreement's terms and applicable Indonesian requirements, including execution and registration of the AJB, tax validation and land-registration or title-transfer procedures. Apart from these Indonesian completion requirements, the proposed acquisition does not require approval from Tien Wah Press shareholders or regulatory authorities.
The group does not expect a material effect on consolidated earnings or earnings per share for the financial year ending Dec 31, 2026, apart from acquisition-related expenses, depreciation and finance costs recognised following completion. Gearing is expected to increase upon drawdown of the bank borrowings.
