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1. INTRODUCTION

The Board of Directors of Malaysia Building Society Berhad ( MBSB ) is pleased to announce that MBSB has entered into a Sale and Purchase Agreement ( the said Agreement ) with Pesona Heights Sdn Bhd( the Purchaser ) to dispose of a piece of vacant land measuring approximately 5.006 acres in area held under Lot No. 46, Geran 47093 Bandar Tanjung Bungah, Daerah Timur Laut Pulau Pinang (  the Property ).

2. DETAILS OF THE DISPOSAL

Pricing basis
The aggregate value of the consideration is RM40,500,000.00. The sale consideration was arrived at through negotiations on a willing buyer-willing seller basis after taking into consideration the location and the present state of the property.

The net book value of the property as per MBSB's latest audited accounts as at December 2003 was RM 33,600,000.

Details of the Purchaser
Pesona Heights Sdn Bhd (Company No. 638564-U) is a company incorporated in Malaysia having its business address at 36th Floor, Menara Gurney, 18, Persiaran Gurney, 10250 Pulau Pinang.

The activity of the company is property development.

3. RATIONALE FOR THE DISPOSAL

The disposal is in line with MBSB's overall objective of disposing some of its non-strategis asset.

4. UTILISATION OF PROCEEDS

The total proceeds from the disposal of property will be utilized for working capital and/or repayment of borrowings.

5. EFFECT OF DISPOSAL

Share capital and substantial shareholders' shareholdings
There will be no impact on MBSBs share capital and substantial shareholders shareholdings and there were no liabilities to be assumed arising from the above transaction.

Earnings
The sale of the Property is expected to result in a gain on disposal to MBSB of approximately RM 6,900,000 for the financial year ending 31 December 2004. The earnings per share of the Group for the financial year ending 31 December 2004 is estimated to increase by 2.04 sen as the result of the disposal.

NTA
There is no material impact on the net tangible assets per share of the Group.

6. CONDITION OF THE DISPOSAL

The disposal is subject to approval being obtained from the Foreign Investment Committee

7. SALE & PURCHASE AGREEMENT

The salient terms of the said Agreement are as follows:

• The Property shall be purchased free from all liens claims and encumbrances together with possession subject however to the conditions and restrictions of title at the purchase price of RM40,500,000.00 upon the terms and condition contained therein.
• The Purchaser has paid earnest deposit amounting to RM450,000.00 and the balance deposit of RM3,600,000.00 upon execution of the Sale & Purchase Agreement.
• The balance purchase price of RM 36,450,000.00 shall be paid within three months from the date of the Agreement (completion period) or as the case may be, at an extended completion date which is four months from the date of expiry of the completion period subject to interest at the rate of 8% p.a. calculated on a daily basis charged on all outstanding amounts due until the date of full payment of the balance purchase price.

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