Dear Dennis Ngu Tai Gah,

Thank you for the reply and please convey my thanks and gratitude to Dato’ Jin Kee Mou (Chief Executive Officer) for an update published in Jaya Tiasa website dated 17 Jun 2025.

https://jayatiasa.listedcompany.com/news_updates.html

I am pleased that Dato’ Jin Kee Mou (Chief Executive Officer) had confirmed that the Board remains committed to the Company’s dividend policy of paying out not less than 20% of its net profit and the Subject Lands are not sited on peat soil and have been physically improved, with some engineering work partially completed, such as the construction of the main drain, land filling and leveling, and the sub base for internal road.

As on land purchase consideration of RM100 million for leasehold land measuring 92,543 square meter or RM 1,080.58 per square meter or RM 100.4 per square feet. The update still raises alarm why Jaya Tiasa did not negotiate with the vendor (Vendor collective net book value of the Subject Lands as at 31 December 2024 is RM16.6 million) for a better price when Jaya Tiasa holds all the cards?

On the update:

The valuation exercise was conducted in accordance with established industry standards and best practices. For further information on the valuation methodologies, Valuation Report pursuant to the Proposed Acquisitions is made available for inspection at the registered office of the Company at No. 1 - 9, Pusat Suria Permata, Lorong Upper Lanang 10A, 96000 Sibu, Sarawak, Malaysia.

May I ask a favor from The Board to publish the above report at Jaya Tiasa website since many of Jaya Tiasa minority shareholders reside all over Malaysia and have problems travelling to Sibu, Sarawak, Malaysia to inspect the document.

Update on: Overview of the development plans

As disclosed in Appendix II of the Announcement, planning and development approvals obtained for the Subject Lands are for the development of commercial towers, commercial shops, apartments, private hospital and a road reserve to be surrendered to the State of Sarawak.

Notwithstanding this, the Company may make changes to the building development plans from time to time, if required, as disclosed in Section 2.4 of the Announcement. Following the completion of the transfer of ownership of the Lands to the Purchaser, the Company may conduct a comprehensive review of the master plan for the Subject Lands (“Review”). The final development plan may or may not differ from the Vendor’s original development proposal, and the Company will use the Review to finalise its own development strategy for the Subject Lands.

Resulting from the above, the Company will only be able to determine the final gross development costs and gross development value upon completion of the Review and hence, the gross development costs and gross development value of RM469.6 million and RM612.7 million, respectively, as disclosed in Section 2.4 of the Announcement, may vary. The Company has also not contracted or committed to any development costs with any parties for the Subject Lands at this juncture, subject to finalisation of its own development strategy.

I'm afraid the above update only confirms the market perception that Jaya Tiasa is not ready or did not have the necessary experience  to take on a property development business that needs a totally different skill set from running a plantation business and most likely this division will be loss making in the future.

Example: A private hospital is a specially built to function functional building and only hospital operators are interested to purchase such buildings that are built to their specification. So had Jaya Tiasa already booked in the client for the private hospital? Or is Jaya Tiasa going to run the private hospital and what will be the additional investment on hospital equipment that can be very costly?

Last but not least I had to disagree with Jaya Tiasa statement “Engaging in property development offers a natural hedge against commodity cycles, contributing to earnings diversification and reducing reliance on commodity cycles”

The above is only true for many plantation companies where their plantation land bought many years ago at very cheap price is now ripe for property development whereas Jaya Tiasa is buying a very expensive leasehold land (RM 100 million)  for property development that carries too much execution and marketing risk.

Thank you

Have a good day

Best Regards

Lee Soon Sheng