Ann Joo exits steelmaking: Green Esteel takes the Prai mill and its 200-acre freehold Bandar Prai title for RM290mil — less than Axis REIT offered for two-thirds of the land

Ann Joo Resources has completed the sale of Ann Joo Steel Berhad — the former Malayawata mill in Prai Industrial Estate and the company that owns the 200.55-acre freehold title it sits on — to Green Esteel Pte Ltd, the Singapore vehicle of steel magnate You Zhenhua, who already controls Southern Steel next door. The headline number in Monday’s filing was RM150 million. The deal is RM290 million; RM150 million is just the instalment that changed hands on completion.

For Penang, this is the largest single transfer of industrial land on the mainland in years, even though no land title moved: the whole of Lot 10136, Geran 186109, Bandar Prai travels inside the company. Ten months ago Axis REIT agreed to pay RM800 million for two-thirds of that land and lease it back. Green Esteel is getting all of it, plus the blast furnace, the electric arc furnace and the rolling mill, for an equity cheque of RM290 million and the RM660 million of debt that comes with the company.

The deal, in numbers

• Seller: Ann Joo Resources Berhad. Buyer: Green Esteel Pte Ltd, Singapore. Target: 100% of Ann Joo Steel Berhad (612,993,535 shares) and its subsidiary Ann Joo Integrated Steel Sdn Bhd
• Price: RM290 million cash, fixed by the circular of 20 August after an independent audit of the target’s balance sheet. The May filing had illustrated RM348.7 million; the formula was RM1.005 billion for the non-current assets, plus current assets, minus all liabilities as at 30 April 2026
• Paid so far: RM70 million deposit in May and RM150 million on 11 September. A RM70 million retention sum is held by the buyer for three months against warranty claims and is due to Ann Joo around mid-December
• Debt that leaves with the company: RM660.3 million of Ann Joo Steel borrowings are deconsolidated. Green Esteel’s effective outlay for the business is therefore about RM950 million
• Use of proceeds: RM230 million repays Ann Joo group bank loans, saving about RM9.2 million a year in interest at roughly 4%; RM59.5 million goes to working capital
• Result for Ann Joo: a pro forma gain of RM98.4 million on the written-down book value — but the filing also lists what the group paid for the shares over 24 years: RM1,002.2 million, including RM424 million injected as recently as September 2023. The exit recovers 29 sen of every ringgit invested
• Approvals: shareholders voted on 4 September with the three Lim family vehicles committed in advance. Completed 11 September 2026

What Ann Joo excluded, and what it did not

The sale carves out four pieces of land that Ann Joo keeps: three lots in Selama, Perak (GM 5709, 5708 and 5735, Lots 46239, 46238 and 46240) and Geran 5398, Lot 426, Mukim 5, Seberang Perai Selatan, with the buildings on them. The circular says the group may sell them “if it receives an attractive offer”.

Everything else stays in the company — and that is the point for anyone who follows Penang land. Ann Joo Steel’s own filing of November 2025, when it accepted Axis REIT’s offer, described its main asset precisely:

• Registered owner: Ann Joo Steel Berhad
• Title: Lot 10136, Geran 186109, Bandar Prai, Seberang Perai Tengah — freehold
• Area: 200.55 acres (81.16 hectares), about 8.74 million sq ft
• Plant: blast furnace (Ann Joo Integrated Steel), electric arc furnace steelmaking and rolling mill, addressed as Lots 1225, 1227, 1236 and 3041, Prai Industrial Estate, 13600 Prai

Who is buying: You Zhenhua and the Prai consolidation

Green Esteel was incorporated in Singapore in August 2017 and has issued share capital of US$720.6 million. You Zhenhua, a Singaporean, holds 39.12% directly and a further 56.65% through Advance Venture Investments and Deep Source Holdings — about 96% in all. The group already owns:

• 50.1% of Southern Steel Berhad, bought for RM315.86 million in new shares at 42 sen in 2024–25 — Southern Steel’s main mill is also in Prai Industrial Estate, a short distance from Ann Joo’s
• 61.16% of BRC Asia, the Singapore-listed reinforcing-steel fabricator
• Antara Steel Mills in Johor, Eden Flame and Esteel Enterprise Sabah, the vehicle for a planned steel complex in Sipitang

The Edge’s Frankly Speaking column read the sequence plainly: Hong Leong, Southern Steel’s other major shareholder, dropped out of the March deal, and You bought Ann Joo Steel directly instead. Two of Malaysia’s three big long-steel mills on the mainland of Penang now answer to one owner, which is as much a statement about capacity rationalisation as about land.

Three attempts to sell one mill

• November 2025 — sale-and-leaseback of 135.53 acres to Axis REIT for RM800 million. Terminated 26 March 2026 after due diligence
• 27 March 2026 — heads of agreement to sell the business to Southern Steel on a RM1.005 billion asset value. Terminated 22 May, days before a 60-day deadline, over regulatory-approval timing
• 22 May 2026 — SPA with Green Esteel on the same valuation basis; RM348.7 million illustrative, RM290 million final. Ann Joo shares fell almost 14% on the news. Shareholders approved 4 September; completed 11 September

Ann Joo’s FY2025 revenue was RM2.17 billion, of which the steel unit contributed RM1.38 billion, or 63.6%. The group’s FY2025 loss of RM234.6 million would have been RM136.2 million without it. What remains is a downstream trader and processor with a stated focus on automotive steel and electrification-related engineering. Its shares traded at 55.5 sen this week, against 65 sen when the Green Esteel deal was announced — a market value of about RM396 million, only a little above the RM290 million it has just been paid.

What it means for Penang

Prai’s biggest freehold industrial title has a new owner with a plan for the plant, not the land. Green Esteel is a steelmaker consolidating capacity; it has bought a mill, and the 200 acres come with it. Nothing in the filings suggests the site is for sale or redevelopment. But the Axis REIT episode showed exactly what the land is worth to a yield buyer — RM135 psf on a leaseback — and that number is now on the record for every owner along the Prai waterfront.

Ann Joo still holds Penang land. Lot 426 in Mukim 5, Seberang Perai Selatan, was kept out of the sale with an explicit invitation to bidders. Together with the Selama lots, it is the residue of a steel group that no longer needs industrial land.

SCOTT: I think RM135 psf is a fair marker for freehold industrial land on the Prai while 60-year PDC leasehold in Bayan Lepas already traded at RM 150 to RM 200psf just for the land.

*Cover photo: The Edge Malaysia. Mill panorama: Ann Joo Resources. Land title, area and pricing details are from Ann Joo Resources’ Bursa Malaysia announcements of 6 November 2025 and 22 May 2026 and its circular of 20 August 2026 as reported by DagangNews.*