Singha Estate furthers its expansion into landed residential development by disposing all shareholding stake in NVD to allow business expansion
Bangkok 23 November 2020 – Singha Estate PCL or “S”, Thailand’s leading real estate developer, decided to dispose all of its investment in Nirvana Daii PCL or “NVD” which equivalent to 51.56% of total paid-up capital of NVD, allowing S to develop landed residential development in all segments by itself to exploit the segment’s growing demand and maintaining its sustainable growth.
Mr. Naris Cheyklin, Chief Executive Officer of Singha Estate Public Company Limited or “S”, revealed that lockdown measures across the board to contain the spread of COVID-19 have greatly impacted everyday life and economic activities, inevitably triggering a global economic crisis. In sharp contrast, however, the accumulated 9-month presales of landed residential properties covering single-detached houses and townhouses of top real estate developers in Thailand impressively grew by almost 10% from the same period last year. The growth emerged against the decline in other sectors, and reaffirmed potential in landed residential property market. By far, most of Singha Estate’s exposure in landed residential property market has been done through an investment in 51.56% of Nirvana Daii PCL or “NVD”.
On 14 August 2020, BOD of Singha Estate passed a resolution to enter into Memorandum of Understanding with the Major shareholder of NVD in order to conduct a due diligence and explore possibilities concerning both parties’ shareholdings in NVD. Both parties had proceeded in accordance with terms and conditions of the MOU and on 23 November 2020, it was concluded that Singha Estate will sell its 711,855,320 ordinary shares in NVD, equivalent to 51.56% of NVD’s paid-up capital at the total consideration of THB 1,793,875,406.40 whereby it is anticipated that the sale will be completed within December 2020. Consequently, after completion of such sale NVD will no longer be Singha Estate’s subsidiary and therefore allowing Singha Estate to develop landed residential properties under its own management without triggering previous concerns on conflict of interest between itself and NVD.
Singha Estate, one of the leading ultra-luxury real estate developer, has successfully launched 4 condominium projects namely The ESSE Asoke, The ESSE at Singha Complex, The ESSE Sukhumvit 36 and The EXTRO together with Santiburi The Residences, a 250 million bath-single-detached house firmly continues to expand residential business portfolio. Selling off all stake in NVD would allow Singha Estate to further exploit the strong demand growth in landed residential property business and doing so on its own management at a faster and more efficient pace. This path will lead Singha Estate to achieve target revenue contribution ratio of 60:40 landed properties to non-landed properties.
“A disposal of all Singha Estate’s investment in NVD eliminates previous concerns on conflict of interest between itself and NVD and is regarded as a crucial steppingstone for Singha Estate to advance its residential business portfolio by covering variety of products and segments. With a well-balance portfolio, Singha Estate could minimize its exposure to the risks posed by clustering of customers, market volatility as well as adverse economic conditions. Ultimately, this strategic move is to enable Singha Estate to achieve sustainable growth and maximize return to its shareholders.”
