PROPERTY and construction player Chip Eng Seng on Wednesday announced that its subsidiary CES-Precast (CESP) will acquire the remaining unexpired leasehold estate in an industrial building in Tuas.
The S$25 million acquisition comes as part of the group’s plans to diversify its businesses amid the Covid-19 fallout.
CESP had exercised the option granted by Concrete Innovators to aquire the property at 65 Tech Park Crescent, and has paid a deposit of S$1 million, in addition to the option fee of S$250,000.
The balance of the purchase price will be payable on completion, said the mainboard-listed Chip Eng Seng in a statement.
The group intends to turn the acquired building into a facility for producing pre-cast and prefabricated prefinished volumetric construction (PPVC) building components in Singapore.
The production of these components are currently carried out by CESP at its pre-cast plant in Johor, Malaysia. The group intends for the new facility at Tuas to complement its plant in Malaysia to increase CESP’s overall production to meet the “burgeoning demand”, said Chip Eng Seng in an earlier statement in March.
Increased production capabilities will correspondingly increase CESP’s capacity to tender for a greater volume of public sector projects of larger scale, to supply more pre-cast and PPVC components to the group’s building and infrastructure construction businesses, and undertake additional projects for other main contractors of building and infrastructure projects, said the group.
Shares of Chip Eng Seng closed up 0.5 Singapore cent at 57.5 cents on Wednesday.