IDEAL UNITED BINTANG INTERNATIONAL BERHAD ( IUBI OR THE COMPANY )

Transcription

1 IDEAL UNITED BINTANG INTERNATIONAL BERHAD ( IUBI OR THE COMPANY ) PROPOSED ACQUISITION PROPOSED PRIVATE PLACEMENT PROPOSED SHARE SPLIT (COLLECTIVELY, THE PROPOSALS ) 1. INTRODUCTION On behalf of the Board of Directors of IUBI ( Board ), M&A Securities Sdn Bhd wishes to announce that IUBI proposes to undertake the following proposals: (i) (ii) (iii) Proposed acquisition by IUBI of the entire equity interest in Modular Platinum Sdn Bhd ( Modular ), Ideal Homes Properties Sdn Bhd ( Ideal Homes ) and Premium Flame Development Sdn Bhd ( Premium Flame ) (collectively, the Target Companies ) from Tan Sri Datuk Ooi Kee Liang ( Tan Sri Ooi ) and Puan Sri Datuk Phor Li Wei ( Puan Sri Phor ) for a total purchase consideration of 353,088,000 ( Proposed Acquisition ); Proposed private placement of up to 393,084,300 new ordinary shares in IUBI ( IUBI Shares ) ( Placement Share(s) ) representing up to 30% of the issued shares in IUBI ( Proposed Private Placement ); and Proposed subdivision of every 1 existing IUBI Share into 2 ordinary shares in IUBI ( Subdivided Shares ) ( Proposed Share Split ). The Proposed Acquisition is a related party transaction pursuant to the provisions of Chapter 10 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad ( Bursa Securities ) ( MMLR ). In this respect, the related parties are Tan Sri Ooi and Puan Sri Phor ( Interested Directors ) by way of their common directorships and shareholdings in the Target Companies. As at the date of this announcement ( LPD ), the Interested Directors indirectly hold 54.07% equity interest in IUBI through their shareholdings in ICT Innotech Sdn Bhd. They are the directors for the Target Companies and also collectively hold the entire equity interest in the Target Companies. 2. DETAILS OF THE PROPOSALS 2.1 Proposed Acquisition On the LPD, IUBI, Tan Sri Ooi and Puan Sri Phor entered into a conditional sale and purchase agreement ( SPA ) for the Proposed Acquisition, which entails the purchase by IUBI of the entire equity interest in Modular, Ideal Homes and Premium Flame, for a purchase consideration of 353,088,000 ( Purchase Consideration ). The Purchase Consideration shall be satisfied entirely via the issuance of 353,088,000 new IUBI Shares ( Consideration Shares ) at an issue price of 1.00 each to Tan Sri Ooi and Puan Sri Phor in the following manner based on their respective shareholdings in each Target Company: Purchase Consideration No. of Consideration Shares Target Company Shareholder Modular Tan Sri Ooi 101,012, ,012,500 Puan Sri Phor 101,012, ,012, ,025, ,025,000

2 Target Company Shareholder Purchase Consideration No. of Consideration Shares Ideal Homes Tan Sri Ooi 58,956,500 58,956,500 Puan Sri Phor 58,956,500 58,956, ,913, ,913,000 Premium Flame Tan Sri Ooi 16,575,000 16,575,000 Puan Sri Phor 16,575,000 16,575, Basis of arriving at the Purchase Consideration 33,150,000 33,150,000 The Purchase Consideration was arrived at based on a willing-buyer willing-seller at an arm s length transaction taking into account the following: (i) The latest audited net assets ( NA ) of each Target Company as at their latest respective financial year end ( FYE ), after accounting for the following: (a) Surplus arising from the revaluation of the material real estate of the Target Companies, which are further detailed in Sections to 2.1.4; The indicative market value of the material real estate amounted to a total of million, as appraised by Messrs Henry Butcher Malaysia (Penang) Sdn Bhd ( Valuer ) vide its letters dated 31 August 2018 ( Valuation Reports ). The Valuer has used the Discounted Cash Flow ( DCF ) Method and cross checked with the Residual Method of valuation for the on-going development projects undertaken by Modular and Ideal Homes. The Valuer adopted the DCF Method as the most appropriate measure to value, as the cash flows from these projects can be reasonably determined in accordance with its development progress. For the property held by Premium Flame, the Valuer adopted the Residual Method and cross checked with the Comparison Method. The Residual method was used as the most appropriate measure as it accounts for the benefit of the development project being undertaken on the subject property. (b) Sales collected and costs paid with respect to the development project under Modular and Ideal Homes for the period between 1 January 2018 and 31 August 2018; and (c) The entitlements to the landowner under the joint venture development projects undertaken by Modular and Ideal Homes.

3 For illustrative purposes, the adjusted NA of each Target Company after taking into consideration the foregoing is computed as follows: Target Company FYE Modular 31 December Ideal Homes 30 June Premium Flame 30 June Total 000 Audited NA 103,394 52,671 4, ,884 Adjustments: (a) Revaluation surplus calculated as follows: - Market value of the real estate 229, ,000 56, ,400 - Less: Net book value (93,196) (124,522) (18,723) (236,441) (b) - Sales collected 48, ,254 - Less: Costs paid (26,295) - - (26,295) (c) Landowner s entitlements (28,184) (45,633) - (73,816) 129,778 85,845 37, ,101 - Less: Deferred taxation (31,147) (20,603) (8,947) (60,504) Net adjustments 98,631 65,242 28, ,596 Adjusted NA 202, ,913 33, ,089 (ii) The future prospects of the Target Companies, in conjunction with the outlook and prospects of the property market in Penang. The Purchase Consideration of 353,088,000 is at a negligible discount to the adjusted audited NA of the Target Companies as computed above. After taking into consideration the above factors, the Board, save for the Interested Directors, is of the opinion that the Purchase Consideration is fair Information on Modular Modular was incorporated in Malaysia on 1 January 2011 under the Companies Act, 1965 ( Act ). As at LPD, it has a share capital of 1,000, comprising 1,000,000 ordinary shares. Modular does not have any subsidiary or associated company. Modular is principally involved in property development. It is currently undertaking the development of a parcel of land identified as Lot No held under Geran No. Hakmilik , within Mukim 10, District of Barat Daya, Pulau Pinang ( Modular Land ). The directors and shareholders of Modular and their shareholdings in Modular are as follows: Name Nationality Number of Modular shares held % Tan Sri Ooi Malaysian 500, Puan Sri Phor Malaysian 500, ,000, Upon completion of the Proposed Acquisition, Modular will be a wholly-owned subsidiary of IUBI.

4 A summary of the audited financial information of Modular for the 3 FYE 31 December 2015, 2016 and 2017 is set out below: Audited FYE 31 December Revenue 320,444, ,460,220 36,181,210 Profit before tax ( PBT ) 69,581,083 25,115,249 10,418,516 Profit after tax ( PAT ) 50,569,014 19,794,368 4,993,266 Shareholder s funds/na 78,606,087 98,400, ,393,721 Borrowings 237, , ,539 Financial commentary The revenue and PAT for FYE 2015 were derived from the completion of the One Imperial project and 50% completion of the Imperial Residences project. The One Imperial Project consists of 5 blocks condominium with a total of 768 units while the Imperial Residences comprises 3 towers of condominium, Tower 1A and 1B houses 10 units on each floor while Tower 2 has 11 units per floor. In FYE 2016, revenue declined by 32.8% and PAT declined by 60.9%, as the completion of the Imperial Residences project contributed almost entirely to the revenue and PAT of Modular for the year. As there were no active projects in FYE 2017, revenue declined by 83.2% and PAT declined by 74.8%, which were derived solely from the sale of balance units of One Imperial and Imperial Residences. The balance units of these projects have been fully sold. Information on the Modular Land By a Joint Venture Agreement dated 4 April 2013 made between Koperasi Tunas Muda Sungai Ara Berhad ( KTM ) and Modular, KTM as the registered owner of the Modular Land has granted its irrevocable consent to Modular the rights of development to develop the Modular Land. The particulars of the Modular Land are set out in the table below: Parent Title Particulars Lot No , Mukim 10, District of Barat Daya, Pulau Pinang held under Geran No. Hakmilik Description Tenure/Expiry date Existing use / Proposed use Land area (square metres) Encumbrances Audited net book value as at 31 December 2017 Market value A parcel of land irregular in shape encompassing a total title land area of approximately 18,635 square metres Freehold Building 18,635 Nil 93,196,158* 229,200,000 Date of valuation 31 August 2018 Method of valuation DCF, cross checked with Residual Method Note:

5 * Comprising land costs of 34,984,312 and property development cost of 58,211,846. On-going development of the Modular Land The Modular Land has been approved by Majlis Perbandaran Pulau Pinang on 7 March 2017 for the following parcel of development known as Imperial Grande, which is on-going and comprises: (i) (ii) (iii) (iv) 2-block apartment (938 units) from the 9 th to 45 th floor; shoplots/office units (65 units) from the lower ground to 1 st floor; parking lots from the lower ground to 7 th floor; and public facilities on the 7 th, 8 th floor, 29 th and 30 th floor. (collectively, the Imperial Grande Project ). The total estimated Gross Development Value ( GDV ) of the Imperial Grande Project is million with a Gross Development Cost ( GDC ) estimated at million and an estimated gross development profit of million. As at 31 August 2018, being the date of valuation of the Modular Land, the project is at 10% completion. The balance of the development is estimated to be completed in 3 years. The future development costs are expected to be financed by a combination of the proceeds from the Proposed Private Placement, bank borrowings and sales of the project Information on Ideal Homes Ideal Homes was incorporated in Malaysia on 23 October 1997 under the Act. As at LPD, it has a share capital of 2,000,000 comprising 2,000,000 ordinary shares. Ideal Homes does not have any subsidiary or associated company. Ideal Homes is principally involved in property development. It is currently undertaking the development of a parcel of land identified as Lot No , held under Geran No. Hakmilik , within Mukim 12, District of Barat Daya, Pulau Pinang ( Ideal Homes Land ). The directors and shareholders of Ideal Homes and their shareholdings in Ideal Homes are as follows: Name Nationality Number of Ideal Homes shares held % Tan Sri Ooi Malaysian 1,000, Puan Sri Phor Malaysian 1,000, ,000, Upon completion of the Proposed Acquisition, Ideal Homes will be a wholly-owned subsidiary of IUBI. A summary of the audited financial information of Ideal Homes for the 3 FYE 30 June 2015, 2016 and 2017 is set out below: Audited FYE 30 June Revenue 92,428, ,183, ,961,114 PBT 14,841,088 22,526,151 14,911,101 PAT 11,528,169 17,046,628 10,941,389 Shareholder s funds/na 78,606,087 41,729,781 52,671,170 Borrowings 446, , ,227 Financial commentary

6 Revenue and PAT in FYE 2015 were entirely derived from the Tree Sparina project, which achieved a completion progress of 45%. The Tree Sparina project comprised three blocks of 26-storey building with a total of 548 resort-style condominium units. Revenue increased by approximately 57.1% and PAT increased by 47.9% in FYE 2016 due to the near completion of Tree Sparina at 88% progress which contributed 136 million of the total revenue. Construction for the Summerskye project began in FYE 2016 and contributed 9 million revenue in FYE In FYE 2017, revenue increased by 12.9% due to the full completion of Tree Sparina and Summerskye s continued progress at 31% for FYE 2017 which contributed 93 million in revenue. However PAT declined by 35.8% due to higher upfront administrative expenses such as staff costs legal fees and contributions. As at LPD, the remainder of the Summerskye project has been completed and fully sold. Information on the Ideal Homes Land By a Joint Venture Agreement dated 26 June 2012 made between KTM and Ideal Property Development Sdn Bhd, KTM as the registered owner of the Ideal Homes Land have granted their irrevocable consent to Ideal Property Development Sdn Bhd the rights of development to develop the Ideal Homes Land. These rights, entitlements and responsibilities have subsequently been assigned to Ideal Homes vide an agreement dated 27 July 2012 made between Ideal Property Development Sdn Bhd and Ideal Homes. The particulars of the Ideal Homes Land are set out in the table below: Parent Title Particulars Lot No , held under Geran No. Hakmilik , within Mukim 12, District of Barat Daya, Pulau Pinang Description Tenure/ Expiry date Existing use / Proposed use Land area (square metres) Encumbrances Audited net book value as at 31 December 2017 Market value A parcel of land irregular in shape encompassing a total title land area of approximately 51,470 square metres Freehold Building 51,470 Nil 124,522,255* 256,000,000 Date of valuation 31 August 2018 Method of valuation DCF, cross checked with Residual Method Note: * Comprising land costs of 102,543,945 and property development cost of 21,978,310. On-going development of the Ideal Homes Land The Ideal Homes Land has been approved by Majlis Perbandaran Pulau Pinang for 2 parcels of development as follows, which is on-going: (i) Parcel 1, known as Amarene (for which development approval was obtained on 26 September 2013), comprises: (a) a 1 block 35-storey condominium (410 units); (b) shoplots and office units (74 units); and

7 (c) 1 floor of recreational space and 5 storeys of parking podium. (v) Parcel 2, known as Mori (for which development approval was obtained on 22 November 2016), comprises: (a) 2 blocks of a 21-storey condominium (480 units); (b) shoplots and office units (87 units); and (c) a 5-storey parking podium. (collectively, the Amarene and Mori Project ) The total estimated GDV of the Amarene and Mori Project is million with a GDC estimated at million and an estimated gross development profit of million. As at 31 August 2018, being the date of valuation of the Ideal Homes Land, the Amarene and Mori Project is at 10% completion. The balance of the development is estimated to be completed in 4.5 years. The future development costs are expected to be financed by a combination of the proceeds from the Proposed Private Placement, bank borrowings and the sales of the project Information on Premium Flame Premium Flame was incorporated in Malaysia on 25 October 1996 under the Act. As at LPD, it has a share capital of 450,000 comprising 450,000 ordinary shares. Premium Flame does not have any subsidiary or associated company. Premium Flame is principally involved in property development. It is currently undertaking the development of 2 parcels of land identified as Lot Nos. 223 and 224 held under Geran Mukim No. Hakmilik 103 and Geran Mukim No. Hakmilik 376 respectively, both within Mukim 10, District of Barat Daya, Pulau Pinang ( Premium Flame Land ). The directors and shareholders of Premium Flame and their shareholdings in Premium Flame are as follows: Name Nationality Number of Premium Flame shares held % Tan Sri Ooi Malaysian 225, Puan Sri Phor Malaysian 225, , Upon completion of the Proposed Acquisition, Premium Flame will be a wholly-owned subsidiary of IUBI. A summary of the audited financial information of Premium Flame for the 3 FYE 30 June 2015, 2016 and 2017 is set out below: Audited FYE 30 June Revenue 453, , ,000 PBT 335, , ,858 PAT 267, , ,298 Shareholder s funds/na 4,298,272 4,565,160 4,819,458 Borrowings 6,403, The revenue and profits earned throughout the financial years under review consists of the provision of project related re-engineering services. There were no major fluctuations in revenue and profits throughout this period.

8 Information on the Premium Flame Land Premium Flame is the registered owner of the Premium Flame Land, the details of which are set out in the table below: Parent Title Particulars Lot No. 223 held under Geran Mukim No. Hakmilik 103, within Mukim 10, District of Barat Daya, Pulau Pinang Lot No. 224 held under Geran Mukim No. Hakmilik 376, within Mukim 10, District of Barat Daya, Pulau Pinang Description Tenure/ Expiry date Existing use / Proposed use Land area (square metres) Encumbrances Audited net book value as at 31 December 2017 Market value 2 parcels of land irregular in shape encompassing a total title land area of approximately 19,147.7 square metres Freehold Building 10, ,852.5 Nil 18,722,801* 56,000,000 Date of valuation 31 August 2018 Method of valuation Residual Method, cross checked with Comparison Method Note: * Comprising land costs of 14,143,236 and property development cost of 4,579,565. On-going development of the Premium Flame Land The Premium Flame Land has been approved by Majlis Perbandaran Pulau Pinang on 18 April 2018 for the following 2 parcels of development collectively known as Imperial Ville, which is on-going: (i) (ii) Parcel 1 comprising: (a) 3-storey houses (3 units); and (b) semi-detached houses (22 units). Parcel 2 comprising: (a) 1 block of apartment units (500 units) on the 9 th to 47 th floor; (b) a parking lot on the lower ground to 6 th floor; and (c) public facilities on the 7 th and 8 th floor. (collectively, the Imperial Ville Project ) The total estimated GDV of the Imperial Ville Project is million with a GDC estimated at million and an estimated gross development profit of 92.7 million. As at 31 August 2018, being the date of valuation of the Premium Flame Land, the project is at 18% completion. The balance of the development is estimated to be completed in 3.5 years. The future development costs are expected to be financed by a combination of the proceeds from the Proposed Private Placement, bank borrowings and the sales of the project.

9 2.1.5 Salient terms of the SPA (i) Agreement to sell Tan Sri Ooi and Puan Sri Phor (the Vendors ), agree to sell and IUBI agrees to purchase the entire equity interest in the Target Companies (the Sale Shares ) for the Purchase Consideration via the issuance of the Consideration Shares, in accordance with the terms and conditions of the SPA, and subject to the fulfilment of the conditions precedent set out in (ii) below. (ii) Conditions precedent The SPA shall be conditional upon the following being fulfilled within 6 months of the date of the SPA or such further extended period as may be agreed between the parties ( the Cut-Off Date ): (a) the conduct and completion of a legal and financial due diligence review on Target Companies, its financial position and the Properties and the results thereof being to the satisfaction of IUBI or deemed satisfactory to IUBI; (b) the Interested Directors, Target Companies and IUBI are not bankrupts/wound up, as the case may be and no bankruptcy or winding up notice has been made against them; (c) (d) (e) (f) the approval of Bursa Securities for the listing of and quotation for the Consideration Shares; the approval from the shareholders of IUBI at an extraordinary general meeting ( EGM ) to be convened; the consent of the lenders of IUBI and the Target Companies, if required; and the approval/consent of any other relevant party, if required. ( Conditions Precedent ) The SPA shall become unconditional on the date when the Conditions Precedent are fulfilled ( Unconditional Date ). (iii) Completion Completion shall take place at the registered office of IUBI or such other place as the Parties may agree on a business day not later than 3 months after the Unconditional Date or on such later date as the Parties may agree in writing ( Completion Date ) where the Consideration Shares shall be allotted to the Vendors and the Vendors shall cause the Sale Shares to be transferred to IUBI. (iv) Termination In the event any of the Conditions Precedent are not obtained or fulfilled within the Cut-Off Date despite all reasonable efforts by the parties hereto then the SPA shall lapse and be of no further effect and thereafter the parties hereto shall be released from all further obligations to each other. On the occurrence of any of the following defaulting events ( Event of Default ), IUBI may (but is not obliged to) give notice in writing to the Vendors for termination specifying the default or breach of the Vendors and requiring the Vendors to remedy the said default or breach within 14 days or such extended period as may be allowed by IUBI, of the receipt of such notice: (a) breach of any material or fundamental terms or conditions of the SPA; or

10 (b) (c) (d) (e) (f) a receiver, receiver and manager, trustee or similar official is appointed over any of the assets or undertaking of any of the Target Companies; or any of the Target Companies enters into or resolves to enter into any arrangement, composition or compromise with, or assignment for the benefit of, its creditors or any class of them; or an application, petition or order is made for the bankruptcy of the Vendors or winding-up or dissolution of any of the Target Companies, or a resolution is passed or any steps taken to pass a resolution for the winding-up or dissolution of any of the Target Companies; or any of the Target Companies cease or threaten to cease carrying on a substantial portion of its business other than in compliance with its obligations under the SPA; or any representation, warranty or statement which is made (or acknowledged to have been made) by the parties in the SPA proves to be incorrect in any material respect. If the Vendors fail to remedy the relevant default or breach within the said 14 days or such extended period as may be allowed by IUBI after being given notice by IUBI, to rectify such breach, IUBI may elect to terminate the SPA and claim damages Basis of the issue price of the Consideration Shares The issue price of the Consideration Shares is It was arrived at after taking into consideration the 5-day volume weighted average market price ( 5D-VWAMP ) of IUBI Shares up to and including 12 October 2018 of , being the market day immediately preceding the LPD. The issue price of 1.00 per Consideration Share represents a discount of 10.08% from the 5D-VWAMP of IUBI Shares up to and including 12 October 2018 of , being the market day immediately preceding the date of this announcement Ranking and listing of the Consideration Shares The Consideration Shares shall, upon allotment and issue, rank equally in all respects with the existing IUBI Shares except that they will not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of which is before the date of allotment of the Consideration Shares. An application will be made to Bursa Securities for the listing of and quotation for the Consideration Shares on the Main Market of Bursa Securities Liabilities to be assumed and estimated financial commitments pursuant to the Proposed Acquisition IUBI will not assume any additional liabilities (including contingent liabilities and guarantees (if any)) under the Proposed Acquisition. The existing liabilities of the Target Companies will be settled in the ordinary course of business. There are no additional financial commitments required from IUBI in respect of the Proposed Acquisition apart from the remaining development costs for the projects undertaken by the Target Companies, which are expected to be financed through a combination of the proceeds from the Proposed Private Placement, bank borrowings and the sales of the project Minimum public spread As at LPD, the Vendors do not directly hold any IUBI Shares, but indirectly hold 59,727,224 IUBI Shares through their shareholdings in ICT Innotech Sdn Bhd, which is equivalent to 54.07% equity interest in IUBI.

11 For illustrative purposes, based on the existing issued share capital of the Company, upon the completion of the Proposed Acquisition, the Vendors will collectively hold 412,815,224 IUBI Shares, equivalent to 89.05% equity interest in the enlarged share capital of IUBI. As such, the public shareholding spread of IUBI will be reduced to 10.95%, which is below the minimum public shareholding spread requirement of 25% as provided under Paragraph 8.02 of the MMLR ( Minimum Public Spread ). In order to ensure continued compliance of the Minimum Public Spread, the Board proposes to implement the Proposed Private Placement in conjunction with the Proposed Acquisition. Further details of the Proposed Private Placement are set out in Section 2.2. For avoidance of doubt, the Proposed Acquisition is not conditional upon the Proposed Private Placement. Should the Proposed Private Placement not be successfully implemented in time with the completion of the Proposed Acquisition, the Board and the Vendors may explore other means of meeting the Minimum Public Spread such as selling their equity interest in IUBI in the open market. Nonetheless, in the event the Company is not in compliance with the Minimum Public Spread, it shall make the necessary announcement as required under Paragraph 3.1 of Practice Note 19 of the MMLR. 2.2 Proposed Private Placement The Board intends to implement Proposed Private Placement together with the Proposed Acquisition to comply with the Minimum Public Spread as well as raise funds for the development of the Target Companies projects. The Proposed Private Placement will entail the issuance of up to 393,084,300 Placement Shares, representing not more than 30% of the issued shares in the Company after the issuance of the Consideration Shares, at an issue price to be determined and announced at a later date. The Proposed Private Placement is conditional upon the Proposed Acquisition, and is expected to be implemented simultaneously with the Proposed Acquisition. In this respect, the Company expects to identify the public investors to subscribe for Placement Shares prior to the issuance of the Consideration Shares. The actual number of Placement Shares will be determined at a later date, after the completion of the Proposed Acquisition, and obtaining the relevant approvals. Subject to the prevailing market conditions and investors interest, the Proposed Private Placement may be implemented in multiple tranches, within 6 months from the date of approval of Bursa Securities for the Proposed Private Placement. As such, there could potentially be several price fixing dates depending on the number of tranches and timing of implementation Basis of arriving at the issue price of the Placement Shares The issue price of each tranche of the Placement Shares, where applicable, shall be determined separately and fixed by the Board at a later date after obtaining the relevant approvals for the Proposed Private Placement. The Board will take into consideration the prevailing market conditions and the provisions of Paragraph 6.04(a) of the MMLR, in determining the issue price of the Placement Shares. In this regard, the issue price shall not be at a discount of more than 10% to the 5D-VWAMP of IUBI Shares. For illustrative purposes in this announcement, it is assumed that the Placement Shares are issued at an indicative issue price of 1.02 per Placement Share (or 0.51 after adjusting for the effects of the Proposed Share Split) ( Indicative Issue Price ). The Indicative Issue Price is based on an approximate 8.28% discount to the 5D-VWAMP of IUBI Shares as at 12 October 2018 of Based on the Indicative Issue Price, the Proposed Private Placement is expected to raise gross proceeds of up to approximately million. The mechanism to determine the issue price of the Placement Shares is in accordance with market based principles.

12 2.2.2 Placement arrangement The Placement Shares will be placed to independent investors ( Placee(s) ) to be identified at a later date. In accordance with Paragraph 6.04(c) of the MMLR, the Placement Shares will not be placed to the following parties: (i) (ii) the interested director, interested major shareholder or interested chief executive of IUBI or a holding company of IUBI (if applicable), or interested person(s) connected with such director, major shareholder or chief executive; and nominee corporations, unless the names of the ultimate beneficiaries are disclosed. Additionally, the Placees shall also be person(s) or party(ies) who/which qualify under Schedules 6 and 7 of the Capital Markets and Services Act Ranking of the Placement Shares The Placement Shares shall, upon allotment and issuance, rank equally in all respects with the then existing issued shares in IUBI, except that they will not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of which is before the date of allotment of the Placement Shares Listing of and quotation of the Placement Shares IUBI shall make an application to Bursa Securities for the listing of and quotation for the Placement Shares. 2.3 Proposed Share Split After the completion of the Proposed Acquisition, the Company proposes to undertake the Proposed Share Split, which entails the subdivision of every 1 existing IUBI Share held by the shareholders of IUBI whose names appear on the Record of Depositors of the Company as at the close of business on an entitlement date ( Entitled Shareholders ) to be determined and announced by the Board at a later date, into 2 Subdivided Shares. For illustrative purposes, based on IUBI s current issued share capital of 110,468,402 comprising 110,468,402 IUBI Shares and after the issuance of the 353,088,000 Consideration Shares to satisfy the Purchase Consideration of 353,088,000, the resultant issued share capital of IUBI upon completion of the Proposed Share Split will be 463,556,402 comprising 927,112,804 Subdivided Shares. For illustrative purposes, based on the closing market price of IUBI Shares as at 12 October 2018, being the last trading day immediately prior to the LPD, the market price of IUBI Shares after the Proposed Share Split shall theoretically be adjusted as follows: Assumed number of Shares held Market Price per Share () Total Value () As at 12 October After the Proposed Share Split Accordingly, the Proposed Share Split is not expected to have any impact on the total market value of ordinary shares held by shareholders of the Company Ranking of the Subdivided Shares The Subdivided Shares will rank equally in all respects with each other after the Proposed Share Split Listing of the Subdivided Shares

13 An application will be made to Bursa Securities for the listing of and quotation for the Subdivided Shares on the Main Market of Bursa Securities. No suspension will be imposed on the trading of the existing IUBI Shares on Bursa Securities for the purpose of implementing the Proposed Share Split as the Proposed Share Split is prescribed as a Specified Subdivision pursuant to Paragraph 13.04(3) of the MMLR. For avoidance of doubt, the Proposed Share Split is conditional upon and shall only be implemented after the completion of the Proposed Acquisition. The Subdivided Shares shall be listed and quoted on the Main Market of Bursa Securities on the next market day following the entitlement date for the Proposed Share Split.

14 2.3.3 Utilisation of proceeds For illustrative purposes, based on the Indicative Issue Price, the Proposed Private Placement is expected to raise gross proceeds of up to million under the 2 following scenarios: Minimum scenario: Assuming no outstanding convertible securities of the Company are exercised prior to the implementation of the Proposals. Maximum scenario: Assuming all outstanding convertible securities of the Company are exercised prior to the implementation of the Proposals. The proceeds raised are expected to be utilised in the following manner: Minimum Scenario 000 Maximum Scenario 000 Notes Expected time frame for utilisation of proceeds (from listing date) Development costs for: (i) Within 24 months - Imperial Grande Project 52,900 74,800 - Amarene and Mori Project 61,648 87,273 - Imperial Ville Project 26,200 37,000 Estimated expenses for the 1,100 1,400 (ii) Immediately Proposed Private Placement Total estimated proceeds 141, ,473 Notes: (i) The breakdown of the working capital for each project is as follows: Minimum Scenario 000 Development costs for Imperial Grande Project: - Development charges and authority Maximum Scenario ,300 25,900 contributions - Piling 24,300 34,300 - Construction 10,300 14,600 52,900 74,800 Development costs for Amarene and Mori Project: - Development charges and authority contributions 21,000 29,700 - Piling 23,800 33,800 - Construction 16,848 23,773 61,648 87,273 Development costs for Imperial Ville Project: - Development charges and authority contributions 8,800 12,400 - Piling 10,500 14,900 - Construction 6,900 9,700 26,200 37,000 (ii) The estimated expenses consist of fees payable to the relevant authorities as well as advisory and placement fees. Any variation in the actual amount of expenses will be

15 adjusted to/from the working capital of IUBI and its subsidiaries ( the Group or IUBI Group ). The actual proceeds to be raised from the Proposed Private Placement are dependent on the issue price of the Placement Shares and actual number of Placement Shares issued. Any excess or shortfall of the actual proceeds raised will be adjusted against the utilisation for the working capital of the Group. Pending the full utilisation of the proceeds raised from the Proposed Private Placement, the Company intends to place these proceeds (including accrued interest, if any) or the balance thereof in interest-bearing deposit accounts with licensed financial institutions or in shortterm money market instruments. The interest derived from the deposits with financial institutions or any gains arising from the short-term money market instruments will be used as additional working capital of the Group. 3. RATIONALE FOR THE PROPOSALS The Proposed Acquisition represents an opportunity for IUBI to bolster its current portfolio of development projects and enhance its profile as a property developer by participating in more property development projects which are profitable. After due consideration of all aspects of the Proposed Acquisition, including the risk factors, the future prospects of the projects undertaken by the Target Companies and the outlook of the property market in Penang, the Board is of the opinion that the Proposed Acquisition is the most appropriate means for IUBI to further its venture into the property development industry at this juncture. The issuance of the Consideration Shares for the Proposed Acquisition will also strengthen the Company s financial position with enhanced shareholders funds. This expected to facilitate the continuous business expansion plans of the Group, which shall be in a better position to undertake property development projects on a much larger scale. The Proposed Private Placement is undertaken to mitigate the non-compliance of the Minimum Public Spread. Additionally, it will enable the Company to raise funds for purposes as detailed in Section without incurring interest costs as compared to other means of financing such as through bank borrowings or the issuance of debt instruments. The Proposed Share Split is expected to improve the liquidity of IUBI Shares on the Main Market of Bursa Securities by increasing the share base of the Company. Furthermore, the adjustment in market price of IUBI Shares pursuant to the Proposed Share Split is expected to result in the Subdivided Shares being more affordable in order to appeal to a wider group of public shareholders and investors. 4. EFFECTS OF THE PROPOSALS The effects of the Proposals are set out according to the following scenarios: (i) (ii) Minimum scenario: Assuming no outstanding convertible securities of the Company are exercised prior to the implementation of the Proposals. The Proposed Private Placement and Proposed Share Split may be implemented at any time after the completion of the Proposed Acquisition. As such, for clarity, to illustrate the maximum number of Placement Shares and Subdivided Shares that may be issued, there are 2 Maximum Scenarios as follows: Maximum scenario A: Assuming all outstanding convertible securities of the Company are exercised prior to the implementation of the Proposals, and the Proposed Private Placement is implemented prior to the Proposed Share Split.

16 4.1 Issued share capital Maximum scenario B: Assuming all outstanding convertible securities of the Company are exercised prior to the implementation of the Proposals, and the Proposed Share Split is implemented prior to the Proposed Private Placement. The pro forma effects of the Proposals on the share capital of IUBI is set out below: Minimum Scenario Shares Issued share capital of IUBI as at LPD 110,468, ,468,402 To be issued pursuant to the Proposed Acquisition 353,088, ,088, ,556, ,556,402 To be issued pursuant to the Proposed Private Placement 139,066, ,848, ,623, ,404,640 To be issued pursuant to the Proposed Share Split 602,623,302-1,205,246, ,404,640 To be issued assuming the exercise of all outstanding warrants 2016/2021 ( Warrants ) (1) 110,468,400 55,234,200 To be issued assuming the conversion of all redeemable convertible preference shares ( RCPS ) (1) 272,700,000 77,719,500 Enlarged share capital 1,588,415, ,358,340 Notes: (1) Assuming the existing 136,350,000 RCPS and 55,234,200 Warrants of IUBI are adjusted on the same basis as the Proposed Share Split. Maximum Scenario A Shares Issued share capital of IUBI as at LPD 110,468, ,468,402 Upon full exercise of existing Warrants 55,234,200 55,234,200 Upon full exercise of existing RCPS 136,350,000 77,719, ,052, ,422,102 To be issued pursuant to the Proposed Acquisition 353,088, ,088, ,140, ,510,102 To be issued pursuant to the Proposed Private Placement 196,542, ,473, ,682, ,983,146 To be issued pursuant to the Proposed Share Split 851,682,802 - Enlarged share capital 1,703,365, ,983,146 Maximum Scenario B Shares Issued share capital of IUBI as at the LPD 110,468, ,468,402 Upon full exercise of existing Warrants 55,234,200 55,234,200 Upon full exercise of existing RCPS 136,350,000 77,719, ,052, ,422,102 To be issued pursuant to the Proposed Acquisition 353,088, ,088, ,140, ,510,102

17 Shares To be issued pursuant to the Proposed Share Split 655,140,602-1,310,281, ,510,102 To be issued pursuant to the Proposed Private Placement 393,084, ,472,993 Enlarged share capital 1,703,365, ,983, Earnings and Earnings per Share ( EPS ) Assuming that the Proposed Acquisition had been effected at the beginning of the FYE 31 December 2017, its effects on the earnings and EPS of IUBI are set out below: After the Audited FYE 31 December 2017 Proposed Acquisition Profit after tax ( PAT ) attributable to owners of 16,188,710 16,188,710 IUBI () PAT of Modular attributable to IUBI (1) - 4,993,266 PAT of Ideal Homes attributable to IUBI (2) - 10,941,389 PAT of Premium Flame attributable to IUBI (3) - 254,298 16,188,710 32,377,663 Number of IUBI Shares 110,468, ,556,402 EPS () Notes: (1) (2) (3) Based on the audited PAT of Modular for the FYE 31 December Based on the audited PAT of Ideal Homes for the FYE 30 June Based on the audited PAT of Premium Flame for the FYE 30 June Following the Proposed Acquisition, the Target Companies are expected to contribute positively to the future earnings of the enlarged IUBI Group. The Proposed Share Split is not expected to have any effect on the earnings of IUBI Group for the FYE 31 December However, there will be a corresponding dilution in IUBI s consolidated EPS as a result of the enlarged total number of issued shares of IUBI arising from the issuance of new Subdivided Shares pursuant to the Proposed Share Split. The Proposed Private Placement is expected to be earnings accretive due to the utilisation of proceeds which are primarily to part finance the development costs of the Imperial Grande Project, Amarene and Mori Project as well as the Imperial Ville Project. As such, the Proposed Private Placement is expected to contribute positively to the Group s future earnings as and when the benefits of the utilisation of proceeds are realised. The EPS of the Group will however be proportionately diluted as a result of the increase in the number of IUBI Shares after the Proposed Private Placement.

18 4.3 NA and gearing The pro forma effects of the Proposals on the NA per share and gearing of the IUBI Group are as set out below: Minimum Scenario (I) (II) (III) After the Proposed Acquisition After (I) and the Proposed Private Placement Audited as at 31 December 2017 After (II) and the Proposed Split Share capital 110,468, ,556, ,404, ,404,640 Other reserves (16,786,881) (1) (17,886,881) (17,886,881) (17,886,881) Shareholders funds / NA 93,681, ,669, ,517, ,517,759 Non-controlling interests 28,188,901 28,188,901 28,188,901 28,188,901 Total equity 121,870, ,858, ,706, ,706,660 Number of ordinary shares in issue 110,468, ,556, ,623,302 1,205,254,604 NA per share Borrowings 330, , , ,333 Gearing negligible negligible negligible negligible Notes: (1) After incurring estimated expenses of approximately 1,100,000.

19 Maximum scenario A (I) (II) (III) (IV) Audited as at 31 December 2017 After full exercise of Warrants and conversion of RCPS After (I) and the Proposed Acquisitions After (II) and the Proposed Private Placement After (III) and the Proposed Share Split Share capital 110,468, ,422, ,510, ,983, ,983,146 Other reserves (16,786,881) (16,786,881) (1) (18,186,881) (18,186,881) (18,186,881) Shareholders funds / NA 93,681, ,635, ,323, ,796, ,796,265 Non-controlling interests 28,188,901 28,188,901 28,188,901 28,188,901 28,188,901 Total equity 121,870, ,824, ,512, ,985, ,985,166 Number of ordinary shares in issue 110,468, ,052, ,140, ,682,802 1,703,365,604 NA per share Borrowings 330, , , , ,333 Gearing negligible negligible negligible negligible negligible Notes: (1) After incurring estimated expenses of approximately 1,400,000.

20 Maximum scenario B (I) (II) (III) (IV) Audited as at 31 December 2017 After full exercise of Warrants and conversion of RCPS After (I) and the Proposed Acquisitions After (II) and the Proposed Share Split After (III) and the Proposed Private Placement Share capital 110,468, ,422, ,510, ,510, ,983,095 Other reserves (16,786,881) (16,786,881) (1) (18,186,881) (18,186,881) (18,186,881) Shareholders funds / NA 93,681, ,635, ,323, ,323, ,796,214 Non-controlling interests 28,188,901 28,188,901 28,188,901 28,188,901 28,188,901 Total equity 121,870, ,824, ,512, ,512, ,985,115 Number of ordinary shares in issue 110,468, ,052, ,140,602 1,310,281,204 1,703,365,504 NA per share Borrowings 330, , , , ,333 Gearing negligible negligible negligible negligible negligible Notes: (1) After incurring estimated expenses of approximately 1,400,000.

21 4.4 Substantial Shareholders Shareholdings For illustrative purposes, the effects of the Proposals on the shareholdings of the substantial shareholders of IUBI are set out in the table below: Minimum Scenario Substantial shareholders (I) As at the LPD After the Proposed Acquisition Direct Indirect Direct Indirect ICT Innotech Sdn Bhd 59,727, ,727, Tan Sri Ooi - - (1) 59,727, ,544, (1) 59,727, Puan Sri Phor - - (1) 59,727, ,544, (1) 59,727, Substantial shareholders (II) (III) After (I) and the Proposed Private Placement After (II) and the Proposed Share Split Direct Indirect Direct Indirect No. of Subdivided No. of Subdivided ICT Innotech Sdn Bhd 59,727, ,454, Tan Sri Ooi 176,544, (1) 59,727, ,088, (1) 119,454, Puan Sri Phor 176,544, (1) 59,727, ,088, (1) 119,454, Notes: (1) Deemed interested through their shareholdings in ICT Innotech Sdn Bhd.

22 Maximum scenario A Substantial shareholders (I) As at the LPD After full conversion of Warrants and RCPS Direct Indirect Direct Indirect ICT Innotech Sdn Bhd 59,727, ,077, Tan Sri Ooi - - (1) 59,727, (1) 211,077, Puan Sri Phor - - (1) 59,727, (1) 211,077, Substantial shareholders (II) (III) After (I) and the Proposed Acquisitions After (II) and the Proposed Private Placement Direct Indirect Direct Indirect ICT Innotech Sdn Bhd 211,077, ,077, Tan Sri Ooi 176,544, (1) 211,077, ,495, (1) 211,077, Puan Sri Phor 176,544, (1) 211,077, ,495, (1) 211,077, Substantial shareholders (IV) After (III) and the Proposed Share Split Direct Indirect No. of Subdivided No. of Subdivided ICT Innotech Sdn Bhd 422,155, Tan Sri Ooi 353,088, (1) 422,155, Puan Sri Phor 353,088, (1) 422,155, Notes: (1) Deemed interested through their shareholdings in ICT Innotech Sdn Bhd.

23 Maximum scenario B Substantial shareholders (I) As at the LPD After full conversion of Warrants and RCPS Direct Indirect Direct Indirect ICT Innotech Sdn Bhd 59,727, ,077, Tan Sri Ooi - - (1) 59,727, (1) 211,077, Puan Sri Phor - - (1) 59,727, (1) 211,077, Substantial shareholders (II) (III) After (I) and the Proposed Acquisitions After (II) and the Proposed Share Split Direct Indirect Direct Indirect ICT Innotech Sdn Bhd 211,077, ,155, Tan Sri Ooi 176,544, (1) 211,077, ,088, (1) 422,155, Puan Sri Phor 176,544, (1) 211,077, ,088, (1) 422,155, Substantial shareholders (IV) After (III) and the Proposed Private Placement Direct Indirect No. of Subdivided No. of Subdivided ICT Innotech Sdn Bhd 422,155, Tan Sri Ooi 353,088, (1) 422,155, Puan Sri Phor 353,088, (1) 422,155, Notes: (1) Deemed interested through their shareholdings in ICT Innotech Sdn Bhd.

24 4.5 Convertible Securities As at LPD, IUBI has 136,350,000 RCPS and 55,234,200 Warrants in issue. There are no outstanding options issued under the employee share option scheme of IUBI. The Proposed Acquisition and Proposed Private Placement will not have any effect on the convertible securities of IUBI. Any necessary adjustments to the existing RCPS and Warrants, if any, as a result of the Proposed Share Split ( Adjustments ) will be made on the entitlement date which is to be determined and shall be effective on the next market day. The Rights Adjustments and will be made in accordance with the Constitution of IUBI (with respect to the terms of the RCPS) and the provisions of the deed poll governing the Warrants. 5. INDUSTRY OUTLOOK AND PROSPECTS 5.1 Overview and outlook of the Malaysian economy The Malaysian economy expanded at a slower pace of 4.5% in the second quarter of 2018 (1Q 2018: 5.4%). Growth was slower on account of supply disruptions in the mining sector and lower agriculture production. The latter is due to supply constraints and adverse weather conditions. On the demand side, growth was dampened by lower public investment and net export growth. Private sector spending remained resilient, expanding further by 7.5% (1Q 2018: 5.2%). In particular, private consumption increased strongly by 8.0% (1Q 2018: 6.9%). On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 0.3% (1Q 2018: 1.4%). Domestic demand recorded a stronger growth of 5.6% (1Q 2018 : 4.1%), as the higher private sector activity (7.5%; 1Q 2018 : 5.2%) more than offset the decline in public sector spending (-1.4%; 1Q 2018: -0.1%). Private consumption expanded at a stronger pace of 8.0% (1Q 2018: 6.9%), the highest since the first quarter of On the supply side, growth was affected by commodity-specific shocks. Major economic sectors, notably the services and manufacturing sectors (77.5% of Gross Domestic Product ( GDP )), remained supportive of growth. Growth in the mining sector contracted, due mainly to declining natural gas output following unplanned supply outages. The agriculture sector s growth declined as the oil palm sub-sector was affected by production constraints and adverse weather conditions. Growth in the services sector was sustained during the quarter, driven primarily by the wholesale and retail trade sub-sector arising from increased household spending following the zerorisation of the Goods and Services Tax ( GST ) rate. Growth was further supported by the information and communication sub-sector, following continued strong demand for data communication services. Growth in the finance and insurance subsector was driven by continued strength in lending activity. The manufacturing sector grew at a more moderate pace supported by continued strength in the electronics and electrical, consumer and construction-related clusters. This can be attributed to the continued demand from fast growing semiconductor segments (e.g. automotive and Internet of Things), and the zerorisation of the GST rate. These gains partly offset the slower performance in the primaryrelated cluster which was affected by the commodity-specific shocks upstream. Growth in the construction sector continued to moderate in the second quarter. In the civil engineering subsector, growth was supported by the ongoing transportation, petrochemical and power plant projects. In the residential and non-residential sub-sectors, growth continued to decline. The development partly reflected the significant number of unsold residential properties and oversupply of office spaces and shopping complexes. Headline inflation, as measured by the annual percentage change in the Consumer Price Index ( CPI ), declined to 1.3% in the second quarter of 2018 (1Q 2018: 1.8%). The lower inflation outcome mainly reflected the zerorisation of the GST rate. As a result, inflation declined to 0.8% in June (May: 1.8%, April: 1.4%). The decline in prices was broad-based where more than 90% of the items that were previously taxed at the standard-rate under the GST were observed to register price declines ranging between 0.06% and 6.75%. As a result, the percentage of items in the CPI basket that registered inflation of more than 2% declined to 18% in the second quarter (1Q 2018: 28%). However, the extent of price decline in June was smaller than anticipated. Prices of standard-rated items in the CPI basket only declined

25 by an average of 2.3%. The impact from the GST zerorisation, however, was offset by higher transport inflation. While the domestic RON95 petrol price was maintained at 2.20 per litre since 22nd March 2018, the lower prices in the base period of the second quarter of 2017 resulted in higher inflation in the transport category. Nevertheless, the fixed RON95 petrol price has helped to contain further increases in fuel inflation during the quarter. Core inflation, excluding the impact of the GST zerorisation, also moderated during the quarter to 1.5% (1Q 2018: 1.9%). This was mainly due to lower inflation in the food away from home sub-category, contributed by the stronger ringgit exchange rate in the first half of 2018 relative to the second half of Demand-driven inflation remained stable. Labour market conditions in the second quarter of 2018 remained supportive of growth. Labour force expansion continued to match net employment gains, resulting in an unchanged unemployment rate at 3.3% (1Q 2018: 3.3%). Employment conditions in the quarter registered stronger growth of 2.4% (1Q 2018: 2.3%). In the financial sector, there was a net employment gain of 1,412 jobs to 165,628 employed persons (1Q 2018: 164,216 persons). This mainly reflected the increase in high-skilled occupations (+ 1,762 persons). Private sector wage growth moderated to 5.7% (1Q 2018: 6.6%). Manufacturing wage growth moderated to 10.1% from a strong growth of 13.9% in the first quarter of On the other hand, the services sector recorded an improvement of 3.7% (1Q 2018: 3.5%) in wage growth, supported by the wholesale and retail trade, and professional services sub-sectors. (Source : Bank Negara Malaysia) Penang The State of Penang, also known popularly as Pulau Pinang, Pearl of Orient, Prince of Wales Island, and Silicon Island of the World, encompasses an island and mainland (Seberang Perai), with a total land area of 295 km 2 and 753 km 2 respectively. The population in Penang was estimated by the Department of Statistics Malaysia at about 1,767,000 as at 2Q The State, with a mix of beachfront, city heritage, and hillside residential living, has been voted as an excellent choice to live, work, play, raise the family and retire. GDP growth of Penang Penang is the country s top three most developed and industrialized state despite being the second smallest state in Malaysia. The manufacturing and tourism industries are the two key engines of economic growth and have generated substantial employment opportunities for the state. The state, with its open and export based economy activities, which is highly dependent upon global demand, was more vulnerable to the external economic climate compared with the country as a whole.

26 GDP ANNUAL GROWTH RATE IN MALAYSIA AND PENANG (Source: Department of Statistics Malaysia and Penang Institute) 5.2 Overview and outlook of the Penang property market The state s property market performance softened further in There were 16,592 transactions worth billion, decreased by 9.6% in volume though value increased by 8.6% against Residential sub-sector continued to lead the overall market, accounting for 72.9% of the state s property transaction volume. This was followed by agriculture (9.1%), commercial (8.1%), development land (7.2%), and industrial (2.7%) sub-sectors. Market activity across all sub-sectors recorded downtrend except for industrial. Commercial sub-sector led the decrease by 20.8%, followed by development land (-12.6%), residential (- 8.7%), and agriculture land (-5.6%) sub-sectors. In term of value all sub-sectors recorded upward trend with the exception of commercial and industrial sub-sectors, down by 11.9% and 25.4% respectively.

27 Residential Property Transaction Residential sub-sector remained as the leading sub-sector with 72.9% share. There were 12,090 transactions worth 5.41 billion recorded in the review period, declined by 8.7% in volume but increased slightly by 0.9% in value.

28 New Launches The primary market recorded fewer new launches with 3,879 units. The numbers were down by 31.3% (2016 : 5,646 units). Sales performance was promising at 39.0% by property type, condominiums and apartments formed the bulk, accounting 65.0% of the total launches. Market Status The residential overhang was less encouraging as the numbers grew in the review period. There were 3,916 units worth 3.82 billion, increased by more than double in volume and value (2016 : 1,896 units worth 1.47 billion). Mostly were condominiums and apartments priced more than 500,000 per unit. Similarly, the unsold under construction recorded a 13.9% increase with 9,249 units (2016 : 8,119 units). The unsold not constructed, however decreased significantly by 97.3% to 80 units in 2017 (2016 : 2,918 units). Construction Activity Construction activities moderated as completions and starts shrank by 19.7% and 33.5% to 11,593 units (2016 : 14,430 units) and 10,681 units (2016 : 16,060 units) respectively. New planned supply however, increased by more than two-fold to 12,864 units (2016 : 3,618 units). As at end-2017, there were 497,396 existing residential units with another 44,046 units in the supply and 24,597 units in the planned supply. Price and Rental Prices of residential properties showed mixed movements. In Seberang Perai Tengah, single storey terraced houses located nearby AEON Mall and TESCO Hypermarket experienced price increase while double storey terraced close to industrial area recorded price gain. Similar price uptrend was recorded in housing schemes located within new townships due to higher

29 demand. In the stratified segment, two-bedroom flats in Taman Sri Aman recorded a notable increase due its strategic location nearby The Golden Triangle in Relau area. Double-digit price increase was also noted for three-bedroom flats located adjacent to higher learning institution such as Politeknik Seberang Perai. As at Q4 2017, the All House Price Index for the state stood at points, up by 4.6% from points in Q The average All House Price for the state as at Q stood at 429,234, increased from 410,058 in Q The residential rental market was on a stable mode across the board with positive rental growth recorded in selected locations. In Seberang Perai Utara, double storey terraces in schemes adjacent to Pusat Perniagaan Raja Uda registered rental increase from 3.1% to 14.2%. similar property in Seberang Perai Selatan also experienced rental increase for houses located nearby Batu Kawan development area. Stratified units particularly flats which are located within industrial areas vicinity recorded rental growth mainly due to higher demand from foreign workers. Meantime, apartments and condominiums showed stable rental trend with movements noted to tenancy and rental renewals. Commercial Property Transaction The commercial sub-sector moderated. There were 1,344 transactions worth 1.05 billion recorded, down by 20.8% in volume and 11.9% in value as compared to 2016.