KUALA LUMPUR: Keck Seng (Malaysia) Bhd will wind down operations and voluntarily liquidate its 99.97 per cent-owned subsidiary, Tanjong Puteri Golf Resort Bhd (TPGR).

TPGR, formerly known as Victavest Holdings Sdn Bhd, operates a 54-hole golf course in Pasir Gudang, Johor.

According to a stock exchange filing, TPGR has been operating under very difficult and challenging market conditions, with a declining number of golfers, ageing assets, increased maintenance expenses, and the severe repercussions of Covid-19.

"As a consequence, TPGR has incurred consistent financial losses over several years and has accrued substantial debts," Keck Seng (Malaysia) said.

Keck Seng (Malaysia), the holding company of TPGR, is also involved in palm oil cultivation and manufacturing, property development and investment, and hotel operations.

TPGR's total outstanding liabilities to short-term unsecured creditors stood at RM57.66 million as of September 22, 2023, the filing showed.

It stated that due to TPGR's ongoing inability to settle its outstanding debts to creditors, including its largest creditor, Keck Seng (Malaysia), continued financial support from the group would not be commercially prudent.

Although Keck Seng (Malaysia) has provided financial support for many years, it is no longer possible for TPGR to continue operations in the face of mounting liabilities, the group said.

The group said that on October 2, 2023, it made a statutory declaration that TPGR cannot continue its business due to its liabilities and appointed an interim liquidator to begin the creditors' voluntary winding up.

Meetings of TPGR shareholders and creditors are scheduled to take place within 30 days of the date of this announcement, it said.

According to Keck Seng (Malaysia), the winding up will have no negative impact on the group's earnings per share and net asset per share for the fiscal year ending December 31, 2023 (FY2023), as well as any operational impact.

Keck Seng (Malaysia)'s total investment in TPGR as of end-December 2022 was RM49.19 million, and based on management accounts made up to September 22, 2023, advances to TPGR stood at RM57.23 million.

The group had fully impaired its investment in TPGR and advances made to TPGR for a total of RM106.42 million.

As a result, Keck Seng (Malaysia) is not expected to provide any additional material impairment in connection with the winding up of TPGR for FY2023, it said.