Tiong Nam Logistics buys warehouse for Rm30mil

JOHOR BARU: Tiong Nam Logistics Holdings Bhd is expanding its logistics warehousing capacity via a Rm30mil acquisition of VM Andaman Sdn Bhd which has its warehouse asset within Pelabuhan Tanjung Pelepas, Johor.

VM Andaman’s warehouse has a built up area of 158,013 sq ft and is on 6.6 acres.

In a statement, Tiong Nam Logistics said the deal would increase the group’s warehousing capacity by 2.6% to 6.2 million sq ft from six million sq ft as at March 31, 2021.

Tiong Nam Logistics had entered into a sale and purchase agreement with VM Andaman’s vendors, Kwasa Logistics Sdn Bhd and Goodman SEA Investments No. 1 Ltd yesterday.

The warehouse has a market value of Rm30.5mil, as ascribed by independent market valuer Burgenns Valuation Sdn Bhd.

Tiong Nam Logistics said the acquisition would be funded by internally-generated funds, of which Rm24mil would be used to subsume the existing vendor loans by Kwasa and Goodman.

The acquisition is expected to be completed by Sept 8, 2021.

Tiong Nam Logistics managing director Ong Yoong Nyock said the group has consistently registered higher deliveries and warehousing volume across industries for the past few quarters, especially on essential segments such as food and beverage, electrical appliances, and information technology equipment, spurred by the work from home normality.

“Meanwhile, the strong performance registered by our logistics and warehousing segment is also helped by the increasing trend of companies outsourcing their logistics requirements to specialist providers like us, as they strive to enhance operational efficiency by focusing on their core business and competitive edge,” he said.

“Hence, as part of our ongoing warehouse expansion plan, this new warehouse in Johor proves timely as it allows us to better serve our customers’ logistics and warehousing needs, while also increasing our warehouse capacity to cater for more customers, moving forward,” added Ong.