44. SIGNIFICANT EVENTS The following is a summary of material acquisition and disposals of properties by the Group’s subsidiaries during the financial year ended 31 December 2021: (i) On 3 August 2021, Tropicana Aman Sdn Bhd, a wholly-owned subsidiary of the Group, entered into a sale and purchase agreement with Kumpulan Tanjung Balai Sdn Bhd, for disposal of a parcel of leasehold land with category of land use “bangunan” measuring approximately 9,590 square metres in Selangor for a total consideration of RM11,871,000. Accordingly, gain on disposal of RM8,937,000 was recognised in the profit or loss upon fulfillment of conditions precedent on 1 September 2021. (ii) On 15 March 2021, Tropicana Golf & Country Resort Berhad, a wholly-owned subsidiary of the Group, entered into a sale and purchase agreement with PI Brilliant Berhad for the acquisition of a piece of leasehold land measuring approximately 2,351 square metres held under H.S.(D) 242691, Lot No. PT9940, Pekan Baru Sungai Buloh, District of Petaling, Negeri Selangor Darul Ehsan for a total of RM2,531,000. (iii) On 15 August 2021, Tropicana Gems Education Sdn Bhd, an indirect wholly-owned subsidiary of the Group, entered into a sale and purchase agreement with Metropark Property Sdn Bhd, for disposal of a piece of freehold land measuring approximately 20,240 square metres together with buildings and structures erected on the land in Selangor for a total consideration of RM103,000,000. Accordingly, loss on disposal of RM10,000,000 was recognised in the profit or loss upon the fulfilment of conditions precedent on 23 December 2021. (iv) On 1 November 2021, Tropicana Alam Sdn Bhd (fka Tropicana Senibong Sdn Bhd) (“TALSB”), a wholly-owned subsidiary of the Group, entered into a joint venture agreement (“JVA”) with Puncak Alam Housing Sdn Bhd (“PAHSB”) to form an unincorporated joint venture for the purpose of developing 3 parcels of leasehold land measuring aggregate area of approximately 1,467,965 square metres, all situated in Mukim of Ijok, District of Kuala Selangor, State of Selangor. Pursuant to the JVA, TALSB undertake the property development with the payment of the Proprietor’s Entitlement of RM334,540,000 to PAHSB progressively up to 72 months from the date of JVA. Outbreak of Coronavirus (“COVID-19”) As at the end of the financial year, the COVID-19 pandemic that had severely impacted the financial performance of the Group for the financial year ended 31 December 2021 is still evolving. As such, the financial performance for the financial year ending 31 December 2022 is expected to remain challenging taking into account of the re-imposition of Movement Control Order and the rise in COVID-19 cases in the country. The property development and property investment sectors in which the Group principally operates in, have been impacted and had experienced setbacks when the movement restriction measures resulted in unanticipated delays in development projects and temporary cessation of businesses. However, these business activities have gradually returned to normalcy as construction and property development activities, as well as other business activities are allowed to continue its operations during the subsequent phases of the movement restriction orders amidst more stringent health and safety procedures imposed by the government, and on the back of a more challenging business environment. The Group is also taking the necessary steps to mitigate the risks to its business arising from the COVID-19 pandemic, including but not limited to more emphasis placed on clearing of unsold inventories, careful rationalisation of new project launches as well as the prudent management of its cash flows. To ensure business continuity and resilience, the Group is also responding to the changing market conditions and had rolled out a series of customer-centric new developments at strategic locations by introducing a digital sales campaign to continue customer engagements, and increase sales. Despite the challenges from the COVID-19 pandemic, the Group expects that all the efforts and measures that the Group has undertaken will place the Group in a good position to unlock the values of its strategic land banks which will subsequently improve its financial performance and deliver sustainable returns to the shareholders. 45. SUBSEQUENT EVENTS (i) On 4 January 2022, the Company acquired the balance of 4,900,000 ordinary shares in Tropicana SJII Education Management Sdn Bhd (“TSEM”) for a total consideration of RM4,900,000. Following the completion of the acquisition, TSEM has become a wholly-owned subsidiary of the Company. (ii) On 19 January 2022, the Company increased its issued share capital from RM2,046,169,848 to RM2,132,569,848 by way of conversion of 72,000,000 ICPS into 72,000,000 ordinary shares at an issue price of RM1.20 per share. Accordingly, the ICPS reduced from RM1,176,467,995 to RM1,092,463,312. (iii) On 24 January 2022, the Company divested its 1 ordinary share in Tropicana Property Services Sdn Bhd (“TPSSB”) representing 100% of the total paid-up capital, for a total cash consideration of RM1 to Megaxis Sdn Bhd (“MSB”). Accordingly, TPSSB has become a wholly-owned subsidiary of MSB, which in turn is an indirect wholly-owned subsidiary of the Company. (iv) On 14 February 2022, the Company had incorporated a wholly-owned subsidiary, Tropicana Entertainment and Retail Sdn Bhd with 1 ordinary share representing 100% of total paid-up capital, for a total cash consideration of RM1. (v) On 8 April 2022, the Company increased its issued share capital from RM2,132,569,848 to RM2,310,169,848 by way of conversion of 148,000,000 ICPS into 148,000,000 ordinary shares at an issue price of RM1.20 per share. Accordingly, the ICPS reduced from RM1,092,463,312 to RM914,863,312. (vi) On 8 April 2022, the Company issued a total of RM130 million in nominal value of senior ranking Perpetual Sukuk pursuant to a Sukuk Musharakah Programme of up to RM2 billion in nominal value. The expected periodic distribution is up to year 5 at 7.25% per annum payable semi-annually. 46. MATERIAL LITIGATION (i) On 26 August 2013, the Company received an order from the Arbitral Tribunal to add the Company as a party to the arbitration proceedings between Dijaya-Malind JV (Mauritius) Limited (“DMML”), Dijaya-Malind Properties (India) Private Limited (“DMPPL”) and Starlite Global Enterprise (India) Limited (“SGEIL”) (“Order”). The arbitration proceedings were previously instituted by DMML and DMPPL against SGEIL to seek the return of the deposit sum and damages arising from termination of the Deed of Novation cum Joint Development Agreement. The Company appealed to the City Civil Court of Hyderabad against the Order which was dismissed on 2 June 2014. As our legal counsel opines the Order was erroneous and wrong in law, the Company has filed a further appeal to the High Court of Judicature of Andhra Pradesh and is pending hearing date to be set. FINANCIAL STATEMENTS NOTES TO THE For the financial year ended 31 December 2021 Annual Report 2021 TROPICANA CORPORATION BERHAD FINANCIAL STATEMENTS AND OTHER INFORMATION 346 347
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