UEM Land ... Nov 2008

Sources say Iskandar Investment Bhd (IIB), the promoter of the IDR is in talks with two operators to set up separate theme parks.

Besides Lego AS, which was reported to be in talks to set up a theme park, IIB is undestood to be in negotiations with Dubai-based Space Investment Co LLC (SIC). SIC is in the midst of setting up SpaceWorld UAE, which is slated to be opened in about a year or two in the Middle East.

SpaceWorld UAE is being developed by SIC with US Space and Rocket Centre as its partner. USSRC, meanwhile, operates as a space-based theme park in Huntsville Alabama.

The plan is to bring in a few small operators and set them up in an area as opposed to having one large player such as Disney or Universal having the whole pie.

While Lego’s investment is understood to be in the region of RM800 million over the next five years, SIC is understood to still be at the negotiating table. Sources say Lego could sign a deal soon, and undertake by March 2009 to commence construction on the theme park by June 2009.

Privately held Lego has other theme parks in Billund in Denmark, Winsor in England, Carlsbad in Carlifornia and Gunzburg in Germany. It is noteworthy that in 2005, Lego sold 70% in Legoland Parks, the operator of the theme parks, to Blackstone Group LP. It is not known if Balckstone is involved in these negotiations.

SIC, meanwhile, has little to show as yet but officials have outlined plans to set up parks in North Africa and the Indian Subcontinent.

Lego’s development will likely be on a 400 acre plot of land off Danga Bay. Khazanah Nasional Bhd has set aside around 3000 acres for the development of theme parks and related businesses. It is not clear how large a site SIC is looking at taking for its intended development.

Previously, IIB and its parent, Khazanah Nasional, had negotiated with Oriental Land Co Ltd, the operators of Disneyland in Japan, and Universal Studios, but these talks fell through.

SIC’s interest comes on the back of similar initiatives by other Middle Eastern companies in Islandar Malaysia. Companies from the Middle East have already come in, tying up with UEM Land Holdings Bhd or buying plots of land for development. UEM Land is a 77% owned unit of Khazanah Nasional.