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Tejoori Limited  -  TJI   

Update on Arjan Plots - Disposal of plot

Released 16:01 04-May-2016

RNS Number : 2708X
Tejoori Limited
04 May 2016
 

Tejoori Limited

("Tejoori" or the "Company")

 

Update on Arjan Plots - Disposal of plot

 

 

The Board of Tejoori (AIM:TJI), the Dubai-based Shari'a-compliant investment company, announces that the Company has on 3 May 2016 entered into an agreement (the "Agreement") with Khansaheb Investment LLC pursuant to which it has agreed to dispose of one of the three Arjan plots of land (an "Arjan Plot" or, collectively, "the Arjan Plots") owned by Tejoori and currently part of Tejoori's investment portfolio, for a cash consideration of approximately US$6.5 million (the "Consideration") (the "Disposal").

 

The Arjan Plots comprise three plots of land in Arjan, a commercial and residential property community development within Dubai Land in Dubai, United Arab Emirates. Tejoori acquired the Arjan Plots in December 2012. The book value of the Arjan Plots in Tejoori's unaudited interim accounts as at 31 December 2015 was US$13.91 million (30 June 2015: US$13.91 million) and the Arjan plot the subject of the Disposal had a book value of US$4.38 million in Tejoori's accounts as at 31 December 2015. The total ground floor area for the three Arjan Plots is 760,361 sq ft, out of which the Arjan Plot subject of the Disposal has a total ground floor area of 238,040 sq ft.  No development has taken place on the plots to date, and in the latest published accounts for the 12 months ended 30 June 2015, the Arjan Plots did not contribute any revenue to Tejoori and incurred a loss on revaluation of US$2,546,358.

 

Khansaheb Investment LLC is a subsidiary of Khansaheb Civil Engineering LLC, a contractor based in the United Arab Emirates that was founded in 1935, with which Tejoori has no historical ties or relationship. Khansaheb Investment LLC is a Dubai-based investment and real estate company involved in the purchasing/selling and development of properties and the construction of infrastructures.

 

The Consideration for the Disposal has been satisfied by a cash consideration of 23,804,000 dirhams (equivalent to approximately US$6,481,600 at the prevailing exchange rate on 3 May 2016) and the Company has received payment in full. There are no outstanding conditions precedent to the Disposal and the effective completion date of the Disposal was 3 May 2016.

 

Following the Disposal, the Company will retain ownership of the other two Arjan Plots, which constitute approximately 68 per cent. of Tejoori's aggregate interests in the Arjan Plots based on the most recent published book values as at 31 December 2015. The Company will also continue to hold its 10.1% shareholding in BEKON and its interests in wakala deposits. The Disposal is not a fundamental change of business as defined in accordance with the AIM Rules for Companies.

 

The Board intends to use the net proceeds from the Disposal, which are estimated to be approximately US$6.4 million, to provide the Company with additional working capital and will provide funds for Tejoori to investigate further investment opportunities in line with its investing policy. In due course, the Company intends to also return a portion of the cash proceeds from the Disposal to Tejoori's shareholders. Any future return of cash to Tejoori shareholders would be undertaken as a separate transaction to the Disposal. There is no guarantee at this stage that any return of cash to shareholders will take place and shareholders will be updated at the appropriate time.

 

The Arjan Plots were acquired by Tejoori in December 2012 and the final deferred consideration payment in connection the acquisition of the Arjan Plots was made by the Company in February 2014. As per previous announcements, the Company continues to assess its options for the Group's remaining interests in the Arjan Plots. These include the potential sale of the plots, individually or as a whole, to a third party and the Board continues to evaluate the options for the Arjan Plots that would seek to maximise returns for Tejoori shareholders. At this stage, no further agreements have been reached and no other contracts have been exchanged with any third party with regards to the remaining two Arjan Plots, and there is no guarantee that any such agreement will be reached or entered into in the near future.

 

The Company will keep shareholders updated on any future developments.

 

Commenting on the transaction, CEO, Abdullah Lootah said: "We are delighted to have completed the sale of the plot for a cash consideration well in excess of the latest published book value. The Disposal is a result of a number of months of hard work from Tejoori management and we will keep shareholders updated on our plans for the remainder of our portfolio."

 

About Arjan:

 

Arjan is an AED 20 billion master planned community covering 11 million square feet and located in the heart of DubaiLand, a significant tourism, leisure and entertainment project.

 

Conveniently situated on Emirates Road and connected to main arterial roads and highways, Arjan is just 10 minutes' drive from Dubai International Airport, close to Dubai World Central International Airport and 60 minutes away from Abu Dhabi, the UAE's capital city.

 

The master developer of Arjan is Minzin, part of the Dubai Government owned Dubai Holdings - a real-estate company specialising in Dubai master developments. Minzin has sold development plots to sub-developers to build their own residential and commercial towers.

 

The developments in Arjan have already commenced, including business towers, entertainment sites and residential complexes.

 

For further information:

 

Tejoori Limited

Tel: +971 4 2839316

Abdullah Lootah, CEO

ceo@tejooriltd.ae



Allenby Capital Limited

(Nominated Adviser and Broker)

Tel: +44 (0)203 328 5656

Nick Athanas/James Reeve


 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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Update on Arjan Plots - Disposal of plot - RNS