EcoFirst Consolidated Bhd has clarified that it still achieved a net gain despite selling eight out of 15 retail units at a lower-than-market price in a recent related party transaction. According to the property developer, the total gain from selling these 15 units exceeded the total original investment cost by approximately RM9.20 million.
The disposal price for these units was appraised in a valuation report dated May 24, 2023, conducted by the valuer CCO & Associates (KL) Sdn Bhd.
Following the sale of the retail units, EcoFirst reported that it forfeited total annual gross rental income amounting to RM567,864 and a net profit of RM362,703.
Earlier on October 20, EcoFirst had announced the sale of 15 retail units from its completed Liberty Arc @ Ampang Ukay mixed development project to its major shareholder, Tan You Tiong, for RM23.82 million. This transaction was considered a related party transaction due to Tan’s direct and indirect shareholdings in EcoFirst. The proceeds from the sale were planned to be allocated for general working capital, expenses arising from the disposal, and estimated real property gains tax.
EcoFirst’s shares closed unchanged at 36 sen on Wednesday, valuing the company at RM435 million.