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PROPOSED JOINT VENTURE WITH ASPL M3A LIMITED TO ACQUIRE PARCELS C AND D OF LOT G FROM KUALA LUMPUR SENTRAL SDN BHD ("PROPOSED JOINT VENTURE AND ACQUISITION")

Contents :

We refer to the query letter from Bursa Malaysia Securities Berhad ("Bursa Securities") dated 20 August 2007 pertaining to the announcement released by Malaysian Resources Corporation Berhad ("MRCB" or "the Company") on 16 August 2007 and in reply thereto, we wish to make the following announcement:

1. Net book value of Parcels C and D of Lot G based on the latest audited accounts.
As at 31 December 2006 (being the date of the latest audited accounts), the net book value of Parcel C and D of Lot G is approximately RM54.5 million.


2. The financial effects of the Proposed Joint Venture and Acquisition on your Company’s net assets per share and gearing (if any).
The Proposed Joint Venture and Acquisition is expected to have positive effect to the future net assets per share of the Company.
The gearing in relation to the development will depend on the amount of project financing required over the tenure of the project and as such will be temporary in nature and reduced accordingly upon completion of the development and its disposal.


3. Sources of funds for the Proposed Acquisition and the breakdown thereof.
MRCB will source entirely from internally generated funds for 60% of the Proposed Acquisition and the development will be financed through borrowings to be procured by Excellent Bonanza.


4. Whether the Proposed Joint Venture and Acquisition is subject to the approval of shareholders and estimated time frame for the application to Foreign Investment Committee.
The Proposed Acquisition does not require shareholders' approval as the percentage ratio is less than 25%. The estimated time frame for the application to FIC is 35 days from the date of the Joint Venture and Shareholders’ Agreement and shall be automatically extended accordingly until all relevant documents necessary to be incorporated in a joint application are furnished.


6. The salient features of the Joint Venture and Shareholders’ Agreement and valuation report and the time and place where it is available for inspection.
The salient terms of the Joint Venture and Shareholders’ Agreement dated 16 August 2007 made between MRCB and ASPL M3A LIMITED (ASEANA) and EXCELLENT BONANZA SDN BHD (Excellent Bonanza) are as follows:-

Final Issued And Paid Up Share Capital of Excellent Bonanza will consist of:

5,000,000 Ordinary Shares of RM1.00 each and 124,812 Preference Shares.

Condition for completion: FIC Approval

The salient features of the Joint Venture and Shareholders’ Agreement are:

The development will consist of:

a) The construction of Tower 1 and Tower 2 with a gross floor area of approximately 300,000 sq ft and 546,000 sq ft respectively;
b) The construction of a podium and basement car park with at least 904 bays upon which both Tower 1 and 2 sit;
c) The construction of a hotel block with a gross floor area of approximately 300,000 sq ft with car parks;
d) MRCB shall be appointed to be the main contractor for the property development and MRCB agrees to appoint a party nominated by ASEANA as the sub-contractor for the Project so as to benefit from 40% of the construction profits.

The Joint Venture and Shareholders' Agreement and Valuation Report are available for inspection by relevant authorities at the Company's registered office at Level 21, 1 Sentral, Jalan Travers, Kuala Lumpur Sentral, 50470 Kuala Lumpur, during normal business hours from Mondays to Fridays (except public holidays) by appointment.


7. A statement by the board of directors, excluding interested directors stating whether the Proposed Joint Venture and Acquisition is in the best interest of the Company, and where a director disagree with such statement, a statement by the director setting out the reasons and the factors taken into consideration in forming that opinion.
The Directors of MRCB, after careful consideration, are of the opinion that the Proposed Joint Venture and Acquisition is in the best interest of the Company. There is no disagreement by any director in respect of the proposal.


8. The prospects and risks in relation to the Proposed Joint Venture and Acquisition.
Risk factors affecting the Proposed Joint Venture and Acquisition include but are not limited to execution risks such as availability of skilled manpower and materials, changes in prices of materials, and also changes in political, economic and regulatory conditions. As property development is one of the Company's core business activities, MRCB has throughout the years established its track record and expertise in undertaking such developments to completion.

As such, the management of MRCB beliefs that the Company is able to mitigate the abovementioned risk factors.


9. The market value and method of valuation as conducted by Messrs CH Williams.
The valuers Messrs CH Williams had on 3 October 2006, assigned a total market value of RM99,000,000 to the land referred to as Parcel C and D of Lot G using the Comparison Method and Residual Method of valuation.


10. The breakdown of the total capital and investment outlay in the Proposed Joint Venture.
The following is the breakdown of the total capital and investment outlay in Excellent Bonanza:

	No. of Ordinary Shares	No. of Preference Shares
MRCB	3,000,000	62,406
ASEANA	2,000,000	62,406
Total	5,000,000	124,812
Total Capital and Investment Outlay	RM5,000,000	RM6,241,224

11. The eventual issued and paid up capital of the Excellent Bonanza.
We envisage the eventual issued and paid up capital of Excellent Bonanza will correspond with the total cost of the development and as per the debt:equity ratio for financing purposes.


12. A statement whether the Proposed Joint Venture and Acquisition has departed from the Commission’s Policies and the Guidelines on Issue/Offer of Securities.
To the best of our knowledge and belief, we are not aware of any departure from the Commission’s Policies and Guidelines on Issue/Offer of Securities.



c.c. Securities Commission