KBunai/Petaling Tin

Dated March 2011 …

Cambodia’s China Central Asia Group (CCAG) is teaming up with KBunai in a beachfront mixed development project in Kamabunai which would see CCAG pumping in RM310 million and the latter providing the land.

Karambunai Corp Bhd would provide 75 acres of land for the project valued RM270 million, which is the first phase of the Karambunai integrated resort city (KIRC) development. CCAG, on its part, would invest RM310 million

Both parties signed a joint venture agreement to undertake the project. Under the JV, CCAG will be investor, contractor and joint developer and provide seed capital of USD$100 million (about RM310 million) as a revolving fund to carry out and undertake the development at its own costs.

The JV is in line with the strategic implementation plan of KIRC, that is that Karambunai Corp shall provide the land and its strategic partners, in this case, CCAG shall provide the necessary funds to unlock the value of KIRC.

This strategy shall also allow KCB to achieve its corporate objective of minimising debt in developing KIRC and the vision of creating a win-win venture with strategic partners who bring in capital and expertise.

Most of the funding in the unincorporated joint venture is from CCAG and KCB’s portion of the funding would be from its own funds.

Dated April 2011 …

A consortium comprising gaming tycoon Tan Sri Chen Lip Keong’s group of companies and Prism Crystal Enterprises Ltd are set to invest RM9.6 billion to develop the Karambunai Integrated Resort City in Sabah with the project’s landowners.

The resort is situated on a 1,100ha piece of land, owned by Karambunai Corp Bhd and Petaling Tin Bhd, on the Karambunai peninsula.

Chen has substantial interest in both companies and is the president of both.

The low-profile businessman is the single-largest shareholder of Karambunai Corp, holding a 43.9% stake. Petaling Tin has a 34.08% block.

Petaling Tin has not signed any agreement with any parties pertaining to the resort project and there are no corporate developments that warrant future disclosures to the stock exchange at this juncture.

Little is known about Prism Crystal Enterprises, which is said to be a special purpose vehicle formed to participate in the Karambunai Integrated Resort City project.

At present, details are scarce on the RM9.6 billion investment in the resort but it is learnt that Chen’s two other listed companies — steelmaker FACB Industries Inc Bhd and Hong Kong-listed gaming and leisure company NagaCorp Ltd — are not part of the plans.

Chen, who founded NagaCorp, is currently the group’s CEO and executive director and he holds a controlling 63.07% stake in the group. NagaCorp owns and operates NagaWorld, the only licensed casino in Cambodia’s capital city, Phnom Penh .

Chen also appears to have considerable clout with the Cambodian government, having been appointed as economic adviser to Cambodia ’s prime minister and an adviser with ministerial status to the Cambodian government.

In March 2011, Karambunai Corp had entered into a joint venture with Cambodia-based China Central Asia Group Co Ltd (CCAG) to develop the Karambunai resort’s first phase, the Karambunai Beachfront mixed development project.

CCAG, a shareholder of Prism Crystal Enterprises, will invest a seed capital of US$100 million (RM306 million) as a revolving fund for the joint venture. Karambunai Corp’s subsidiary, Karambunai Resorts Sdn Bhd, will contribute 75 acres of land valued at RM270 million to the joint venture.

Prime Minister Datuk Seri Najib Razak said the Karambunai Integrated Resort City is expected to contribute a gross national income of RM9.3 billion and create about 11,002 jobs by 2020.

Plans for the Karambunai resort include attractions like a water theme park, mangrove research centre and spa village. The project will also house luxury residences, hotel accommodation, retail space and eco-nature facilities. However, questions still linger as to whether the resort will eventually feature a casino despite the company denying reports on the plans.

Karambunai Corp already has hospitality operations in Sabah with its five-star Nexus Resort Karambunai and Nexus Golf Resort. The Karambunai Integrated Resort City will be eveloped over eight years from 2012 to 2019.



Dated June 2011

Tan Sri Dr Chen, who owned 43.9% stake in Kbunai unveiled plans of the multi billion ringgit eco nature integrated resort in Sabah . He has since brought in Cambodian investor along with a consortium comprising his own companies to invest in the Karambunai Integrated Resort City project.

But the question remains as to whether the Malaysian government will issue another casino licence let alone one to Karambunai

Meanwhile his gambling resort in Cambodia has been growing steadily and raking in the returns. Chen’s HK listed NagaCorp Ltd owns operates NagaWorld , Cambodia ’s largest gaming resort which houses a casino and a hotel.

Recently, NagaCorp is said to have signed deal with Chen to acquire a hotel, gaming and retail project located next to the existing NagaWorld site in the capital city of Phnom Penh .

Dated Oct 2010

KBunai has clarified that it has not received any notification from the government nor has it signed any agreement with or have shareholding in special purpose vehicle (SPV) originated by its controlling shareholder, together with a Beijing-based contractor, to develop an integrated eco-nature resort in Karambunai.

Karambunai Corp's controlling shareholder is low-profile tycoon Tan Sri Dr Chen Lip Keong.

The promoter was a SPV specifically incorporated to assess the feasibility of investing in the Karambunai Peninsula . Together with its local and overseas consultants, including its financial consultant China Construction Bank International, the SPV aims at bringing in foreign direct investments to Malaysia and has presented proposals to the Malaysian government to assess the relevance and importance of developing Karambunai, Sabah to spearhead the growth of tourism in the Eastern corridor of Malaysia.

Up to date, Karambunai Corp has no shareholding in the SPV, nor has it received any official notification from the government or signed any MoU (Memorandum of Understanding) or agreement with the SPV to develop Karambunai yet.

However, both the management of Karambunai Corp and SPV have concrete, specific, clear time-line plans and commitments to the Malaysian government to attain the desired results under Economic Transformation Programmes as envisaged by the Government.

Its board of directors was of the opinion that there were not yet corporate developments which merit disclosure.

KCB said its property was included in the Budget 2011 speech after its Nexus Karambunai Hotel general manager attended the Performance Management and Delivery Unit-driven national key economic areas tourism lab together with other members of the private and public sectors.

The Prime Minister Datuk Seri Najib Tun Razak in his budget speech said Nexus Karambunai, a renowned resort in Sabah , had committed to developing an integrated RM3bil eco-nature resort, the first in the world, by leveraging on its natural beauty and uniqueness.

Najib added that the project would commence in 2011 and the Government would give RM100mil.