20100323 1001 Malaysia Corporate News.

Sales of new vehicles rose 8.7% yoy in February 2010, but eased nearly 20% on a monthly basis because of shorter working days. Total industry volume (TIV) last month stood at 40,654 units, compared with 37,386 units in the same month in 2009. But it was 19.7% lower than the previous month, the Malaysian Automotive Association (MAA) said. (BT) The mom contraction was not a surprise since February has traditionally been a weak month due to the shorter working period. February's 8.7% yoy growth was encouraging and came in ahead of our 6% TIV growth projection for 2010.

Sports betting may soon be legalised, probably in time for the Fifa World Cup finals in South Africa from June 11 to July 11. It is understood that Berjaya Corp is seeking approval from the authorities to operate sports betting activities in the country, though it is unclear which betting system will be used. This is not the first time Berjaya Corp has approached the government to make sports betting legal. (NST) If true, we expect Berjaya Corp’s NFO subsidiary, Berjaya Sports Toto, to also benefit given that the latter has some 680 outlets throughout the country which can be readily used to take on over-the-counter bets.

Palm oil plantation owners in Sabah face increasing cost of doing business due to the slow trunk road upgrade between major towns and labour shortage, says Kam Cheong Plantations S/B director Cheong Sung Yan. He is also the Incorporated Society of Planters (ISP) Sabah's northeast branch chairman.

• "Many oil palm planters have long suffered from congestion and slow transport of oil to the ports for shipment as well as shortage of labour to harvest fruit bunches and the government should speed up upgrading of trunk roads here to handle heavy loads of produce. We now face congestion problem. Sabah produces about a third of Malaysia's palm oil exports", say Cheong. (BT)

Telekom Malaysia has signed agreements with 20 content partners to provide a diverse mix of programming and content for its soon-to-be launched, Internet Protocol Television (IPTV) service. Executive VP of Consumer Jeremy Kung said the IPTV service is part of the company's triple-play offering that serves as a value-added service for its High Speed Broadband (HSBB) customers.

• The service is similar to cable TV but utilises a broadband connection instead of cable, for delivery of video services. Initially, the IPTV service will be offered within four HSBB coverage areas, Taman Tun Dr Ismail, Subang Jaya, Shah Alam and Bangsar and expanded to other areas soon. (Bloomberg, BT)

Telekom Malaysia is planning to penetrate into television service via its high-speed broadband (HSBB) and will initially offer 22 channels from content providers such as BBC, STAR and Channel News Asia. Subscribers will be able to view TV programmes via TM's fibre network which targets up to 10 mbps. It will also feature local FTA channels TV1, TV2, TV3, NTV7, 8TV, and TV9.

• Aside from IPTV, consumers can also enjoy high-speed internet access and VOIP. HSBB is expected to be rolled-out in Kepong, Wangsa Maju, Segambut, Damansara, Titiwangsa, Cheras, Seputih, Petaling Jaya, Serdang, Puchong, Putrajaya, Damansara, Cyberjaya, KLIA, Klang, Selayang and Ampang by year end. (Financial Daily)

Green Packet will secure 75% of Taiwan’s WiMAX market following the signing of a partnership with Taiwanese WiMAX operator, Global Mobile Corp, to provide its Intouch Connection Management solution (Intouch CM).

• Senior GM, Kelvin Lee, said the company’s foothold in Taiwan would help fortify its leading position in the Asia-Pacific (APAC) market. “We’ve set our sights to be the world’s No 1 vendor by end-2010. We believe that APAC, with its high growth prospect, will be our springboard,” he added. (Financial Daily)

The remaining RM2.8bn in the Universal Service Provision (USP) fund will be utilised to carry out some National Broadband Initiative (NBI) programmes which are currently in the pipeline. “To-date, some RM1.7bn has been dedicated to build 447 telecommunication towers, of which two-third will be located in Sabah and Sarawak, said Malaysian Communications and Multimedia Commission (MCMC) Chairman Tan Sri Khalid Ramli. Khalid said other plans under the NBI would be announced by PM Datuk Seri Najib Tun Razak on March 24. (Bernama)

The Sabah state government views Tenaga’s Small Renewable Energy Programme as an environment-friendly option that can run parallel with coal-fired plants to ease the power shortage. "Power generation from biomass is good for the environment, but it is not the only solution. We can explore all possibilities to ease power shortage in Sabah," state Minister of Tourism, Culture and Environment Datuk Masidi Manjun said. (BT)

CMS says it will use the bulk of the RM465.5m received from selling its 37.2% stake in UBG Bhd to Petrosaudi International Ltd to invest in emerging business opportunities in Sarawak. Among the possible projects are in the Sarawak Corridor of Renewable Energy (SCORE) region and a world-class aluminium smelter at Samalaju Industrial Park in Sarawak.

• CMS also plans to use up to RM88m of the sale proceeds to repay the outstanding revolving credit facility of its 51% owned unit PPES Works (Sarawak) Sdn Bhd. The proposed utilisation of the proceeds is expected to be completed by the second quarter of this year. (BT)

AmBank Group plans to bolster its Islamic banking and financial services in the region as part of its expansion drive. Chairman Tan Sri Azman Hashim said the banking group intends to tap Islamic banking's big potential for growth. "But we will expand on our own and will not buy any stakes in other banks or seek partners. Malaysia is already known as a leader in Islamic banking and we should continue to lead," he said.

• Azman said the banking group was looking to growth this year and in coming years as it expects profits to keep improving with new products and its low NPL ratio. On mergers and acquisitions, Azman said it had not approached nor had it been approached by other banks. (BT)

AmBank sold RM1.42bn of bonds, less than planned, as it balances its assets and liabilities. AmBank, part of AMMB Holdings Bhd, may sell a further RM1bn in private placements after meeting with investors later this month. "Demand was very strong but some investors' expectations on pricing we thought were unrealistic, so we said we're not interested," CFO Ashok Ramamurthy said.

• AmBank said it may sell as much as RM3bn of senior debt for the first time as it seeks to lower interest-rate risk and boost its capital adequacy ratio - a measure of a bank's financial strength. The sale is part of the bank's RM7bn senior-note programme.'
• The RM1.42bn of sales includes RM1.14bn of 4.95% five-year notes and RM101.3m of 3.2% securities due Mar 11, according to data compiled by Bloomberg. (BT)

Citibank is looking to increase its market share in the affluent segment by 20% over the next 24 months, its Business Director for Cards and Consumer Lending, Anand Cavale, said. The bank is enhancing its Platinum card to make it more exclusive and rewarding by offering five time rewards points, when customers use their cards at all major supermarkets all year long.

• With this strategy in place, he said the bank will be strengthening its leadership position with customer focused programs that will increase spending by 25%. Currently, the affluent segment makes up more than 10% of the bank's card base and contributes to more than a quarter of Citibank's overall card spending, he added. 
• Citibank is the market leader in the credit card industry with a 20% share of credit card usage, and over a million card members. (Bernama)

The EON Bank Group aims to grow its credit cardholders to 700,000 this year, from 620,000 last year, helped by various promotions and the launch of a new card for shopaholics. The amount consumers are expected to spend using its cards is also expected to increase by 15% this year, as the economy recovers, CEO Michael Lor said.

• Last year, the bank managed to add 110,000 new cardholders, although a new RM50 service tax by the government has caused 25,000 in cancelled cards, he said. The bank has teamed up with the Malaysian Retailer Chains Association (MRCA) for the MRCAEON Bank credit card, which it hopes will attract 50,000 cardholders this year. (BT)

The proposal for a Proportional Insurance Premium policy by the Home Ministry, where car owners who install additional security features are charged lower insurance premiums, will help reduce losses through vehicle thefts, said Allianz General Insurance Company CEO Ng Hang Ming. Early this year, Home Minister Datuk Seri Hishammuddin Tun Hussein proposed that owners of vehicles with security systems would enjoy lower insurance premiums than those without security systems. The Home Minister had said that Bank Negara Malaysia, together with General Insurance Association of Malaysia (PIAM), would discuss and fix the Proportional Insurance Premium Policy, while the insurance tariff would be prepared by Bank Negara. (StarBiz)

Proton Edar aims to establish 50 exclusive Proton Parts stockists nationwide by 2013. "By year-end, Proton aims to establish 13 exclusive stockists in major towns," its CEO, Mohamad Shukor Ibrahim said. "Apart from providing a platform for customers to confidently purchase genuine parts, the establishment of the outlets, is also aimed at eliminating confusion over imitation parts sold at the prices of those that are genuine," Mohamad Shukor said. He said there is a huge opportunity for the spare parts business with 2.4m Proton cars on the road. (Bernama)

Some 6bn units of Amanah Saham 1Malaysia (AS1M) are still available for public subscription, says PNB president Tan Sri Hamad Kama Piah Che Othman. Most of the available units are for Bumiputeras and Indians. "Only 8% or 238m units of the 3bn allocated for the Chinese community is still available," he said.

• The AS1M fixed price fund, with a size of 10bn units, was launched in Jul-09. Half of the units were allocated for Bumiputeras, 30% for the Chinese, 15% for the Indians and 5% for other races. (BT)

Amanah Saham Nasional (ASNB) has declared an income distribution of 6.3sen per unit for Amanah Saham Malaysia (ASM), for FY Mar-10, ASNB, a wholly-owned subsidiary of Permodalan Nasional Bhd, said this translates to a total payout of RM654.1m, about 60% higher yoy.

• Last year, ASNB announced a 6.25sen income distribution for ASM, a fixed priced equity-income fund open to both Bumiputeras and non-Bumiputeras.Total ASM units subscribed has also increased by 55.3% from 7.21bn on Mar-09 to 11.2bn on 19 Mar 2010", says PNB chairman Tun Ahmad Sarji Abdul Hamid. (BT)

The introduction of high-definition TV (HDTV) and lower prices of flat-panel sets have resulted in a boom in business for such electrical appliances. With the football World Cup starting in June, many manufacturers are also cashing in by introducing the latest HD TVs, such as LED TVs, in addition to the LCD units.

• A store operator observes that since the launch of Astro B.yond in Dec 09, there had been a 20% to 30% increase in sales of LCD TVs in the store’s 10 Klang Valley outlets. A 42-inch LCD TV is now priced at between RM3,000 and RM4,000, compared to over RM10,000 several years ago. (Star)

MMC Corp has appointed Datuk Hasni Harun as group MD from May 3. As group MD, Hasni will assume responsibility over the management of both the domestic and international operations of the MMC group. Hasni will oversee MMC's international operations and assume administrative authority of CEO (International), Feizal Ali, who will be on leave from April 1, prior to his departure from MMC on May 3. (BT)

KNM Group said it will not extend BlueFire Capital Group Ltd's exclusivity period for due diligence, which expired yesterday. BlueFire, an entity controlled by founder and group MD Lee Swee Eng, had offered to buy out KNM at RM0.90/share, valuing the process equipment maker at RM3.6bn.

• Lee, together with GS Capital Partners VI Fund LP, a private equity fund of the Goldman Sachs Group Inc, and Mettiz Capital Ltd, had made a conditional offer to buy KNM's assets on Feb 4. The offer was conditional upon a due diligence that should be completed by Mar 22 and which includes a final valuation of the assets within the group.
• Lee owns 23.64% of KNM. BlueFire announced that it is "still in continued discussions with the company and the parties have agreed to endeavour to conclude discussions by Apr 16. (BT)

UEM Land priced its proposed rights issue shares at 80 sen each, 44% discount to the stock’s recent average price. UEM Land hopes to raise gross proceeds of RM971.3m from the 1-for-2 rights issue. (Bloomberg, BT)

YTL e-Solutions has appointed former Microsoft Malaysia MD Yasmin Mahmood as ED and former MAS MD Datuk Ahmad Fuaad Mohd Dahalan as an independent director. Meanwhile, it announced the resignation of siblings Datuk Yeoh Seok Hong and Datuk Mark Yeoh Seok Kah from their executive directorship, with immediate effect. (Financial Daily)

Ho Hup Construction’s new board has found “no information available” on the basis and justification of the shared ratio for the joint-development agreement (JDA) announced last week between the company and Malton, nor for Ho Hup’s reported minimum entitlement of RM265m. (Financial Daily)

Talam Corp has agreed to sell two pieces of leasehold land in Kuala Langat, Selangor, measuring 41.69 acres and 8.1 acres to Malaysian Allied Health Sciences Academy (MAHSA) for RM35.41m. The proposed disposal will assist the group in reducing its bank borrowings. (Financial Daily)

Sunway City has redesignated Ngian Siew Siong as MD, property development, international, and appointed Ho Han Sang as MD of its Malaysian property development arm with effect from March 19. (Financial Daily)

TM Asia Life Malaysia expects its new product Life Protector Excel to generate RM10m in sales this year. Life Protector Excel is a value for money premium plan, which offers comprehensive coverage for death, total and permanent disablement, dreaded diseases, double indemnity on accidental death and hospitalisation benefit. (BT)