KUALA LUMPUR: Sapura Industrial Bhd

is disposing of a 2.163ha tract of leasehold land in Bukit Katil, Tempat Ayer Keroh, in Melaka to Loongsen Plastics (M) Sdn Bhd for RM10.48mil.

According to the company's filing with Bursa Malaysia, the property is currently tenanted with a rental income of RM2,940 per month.

The property was initially acquired to expand the company's plant in Melaka, and has been held as an asset for 25 years.

"Having considered the need for an expansion of plant in other areas that are in closer proximity to the company’s or its subsidiaries’ customers, the board believes that the proposed disposal is timely, allowing the company to unlock the value of its non-core assets and convert them into liquid funds for more productive operational use and other expansion opportunities," it said.

Sapura Industrial intends to utilise the proceeds of the sale to expand production lines for new projects as well as to finance future expansion and strategic initiatives.