Advance Synergy Bhd to Sell & Leaseback Three Hotels for $28 Million

The Edge Daily - December 13, 2005

Amanah Raya Bhd is acquiring Holiday Villa Alor Setar, Holiday Villa Cherating and Holiday Villa Langkawi from Advance Synergy Bhd (ASB) for a total of up to RM105 ($27.8 million) cash in a proposed sale and leaseback.

Announcing the deal on Dec 13, ASB said it had each accepted an offer from Amanah Raya to acquire Holiday Villa Alor Setar, Holiday Villa Cherating and Holiday Villa Langkawi for up to RM30 million, RM23 million and RM52 million respectively. ASB will have the option to buy back the hotels from Amanah Raya for a total of up to RM105 million upon the expiry of the leaseback period.

Under the deal, Amanah Raya will lease back each of the hotels to the ASB subsidiaries separately for 10 years with an option of another five years. The leaseback is guaranteed by Alangka-Suka Hotels & Resorts Bhd, a subsidiary of Advance Synergy. The net rental of the leaseback for the 10-year period was structured as 7% per annum for the first three years, 7.5% for the next three years and 8% for the remaining period. For the extended five-year period, the net rental of the leaseback will be at a rate mutually agreed by both parties. Sphere: Related Content