The offer is priced at a premium of 1.2 per cent above the net asset value of MCL Land, which would have yielded a share price of S$1.73 in September, and at a premium of 25 per cent on the stock's last traded price of S$1.40 before dealing was suspended.

The acquisition is part of Hongkong Land's strategy to grow in the commercial and residential property markets of Singapore and Malaysia. The company has a strong property portfolio in the Central district.

Hongkong Land has been expanding in Singapore and Macau to maintain sustainable earnings growth outside Hong Kong.

Its partnership with Cheung Kong (Holdings) and Keppel Land in October landed it a S$1.8 billion property development - a prime office, residential and retail project in Marina Bay which will become a 244,000 square metre development over eight years.

The same consortium has also taken part in the One Raffles Quay project next to the site.

An analyst said the buyout would also eliminate any conflict of interest while both companies engaged in property development in Singapore.

On full acceptance of its offer, Hongkong Land will pay S$647 million from existing cash resources. The firm was known to have cash on hand of about US$659 million as at the end of June.

'Hongkong Land considers MCL Land's position in the Singapore and Malaysian markets will be enhanced by being a member of a focused property group,' the company said.

Jardine Strategic owns 45 per cent of Hongkong Land and 62.2 per cent of Jardine Cycle & Carriage, which in turn holds 65.6 per cent of MCL Land.

Jardine Cycle & Carriage said it would distribute dividend payments to its shareholders subject to their approval at the extraordinary general meeting.

Once the distribution of the dividend payment has been completed, Jardine Strategic will own 40.8 per cent of MCL Land.

All in the family

$2.9b deal part of portfolio consolidation plan

Offer at premium of 25pc above pre-suspension trading price

Acquisition to be funded from company's internal resources