Monday, March 19, 2012

20120319 1014 Malaysia Corporate Related News.

Nine shortlisted for Prai power project
Nine consortia and sole bidders have been shortlisted by the Energy Commission to participate in the tender process for the Prai combined-cycle gas turbine power project. The consortia comprise 1Malaysia Development, which has teamed with South Korean conglomerate Hyundai Engineering & Construction; YTL Power International with Marubeni Corp of Japan; CI Holdings and Teknologi Tenaga Perlis Consortium SB with Daelim Industrial Co Ltd of South Korea; Amcorp Power SB with Japanese group Mitsui & Co Ltd; and Malakoff Corp and Petronas Power SB with Mitsubishi Corp of Japan. (StarBizWeek)

MCMC: No memo issued on 6% prepaid tax
The Malaysian Communications and Multimedia Commission (MCMC) said it has not issued a memo to telecommunication companies instructing them to be prepared for a proposed 6% tax on prepaid phone subscribers. MCMC chairman Datuk Mohamed Sharil Tarmizi said: “No such instruction was issued on this matter.” “Discussions are actively being carried out to find the best and most equitable solution so that consumers will continue to receive affordable communications services that will benefit the people,” he said in the statement. (StarBizWeek)

Proton confident of selling 4,000 latest car per month
Proton Holdings is optimistic of achieving monthly sales of 4k units for its new model, codenamed P3-21A, group MD Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir said. He said the car, scheduled to be officially launched by next month, would redeem Proton’s image as a capable manufacturer of cars and attract buyers from local and overseas markets. (StarBizWeek)

Pharmaniaga plans expansion in Mideast, South-East Asia
Malaysia’s largest homegrown pharmaceutical group, Pharmaniaga plans to expand its market in the Middle East and South-East Asia, particularly Saudi Arabia, Indonesia, Myanmar and Vietnam. Chairman Tan Sri Lodin Wok Kamaruddin said the company was looking for growth opportunities in these countries, including through M&As. (StarBizWeek)

Nadzmi resigns as Proton chairman and director
Datuk Seri Mohd Nadzmi Mohd Salleh has resigned as Proton chairman and director effective immediately due to the change in shareholdings in Proton Holdings. Nadzmi’s resignation was part of the terms that had been agreed upon when DRB-Hicom signed the conditional share sale and purchase agreement with Khazanah Nasional to sell the latter’s 42.74% stake to the former on 16 Jan. (StarBizWeek)

Esso not seeking other takeover offers
The board of Esso Malaysia is not seeking any alternative takeover offers after it received notice of an unconditional takeover offer from San Miguel Corp. SMC had on 17 Aug 2011 proposed the acquisition of 175m in Esso Malaysia, representing a 65% stake, from ExxonMobil International Holdings for RM3.59 each. (StarBizWeek)

JEV not planning to sell Jimah plant
Jimah Energy Ventures SB (JEV) is currently not looking to sell its power plant in Port Dickson, Negri Sembilan, a source said, quashing market speculation to the contrary. JEV, an independent power producer, owns and operates the 1,400MW coal-fired Jimah power plant. Speculation is rife that the plant is up for sale, with rivals reported to be interested in making a bid for it. Talk has it that a sale could fetch more than RM1bn. (BT)


US-based Hess is expected to award a contract for a FPSO vessel for the North Malay Basin development soon and plans to start production late this year. According to sources, Bumi Armada and MISC, with their respective partners, are vying head-to-head for the contract. (Edge Weekly)

Petronas Dagangan has recorded negative operating cash flow for three quarters up to 31 Dec 11. In a written reply to the newspaper, PetDag notes that a factor that affected the negative operating cash flow was the timing in receiving the subsidy from the government. (Edge Weekly)

The completion of property developments under the low deposit incentive schemes, coupled with Bank Negara Malaysia’s (BNM) changes in bank loan computations from gross to net income, may result in higher rates of defaults, according to industry observers. The incentives often referred to as 5/95, 10/90, 15/85 or 20/80 schemes, allow home buyers to pay a small down payment of 5-20% of the property price. The balance 80-95% is only due after completion of the property, and is often covered by a bank loan. Some developers, notably of luxury condominium projects, even extended the incentives to include a delayed repayment period of up to two years after the handover. (Financial Daily)

Pelikan International Corp CEO Loo Hooi Keat says the company could raise around RM360m from the sale of the group's plants and its logistic assets that are not recording adequate yields. The asset sales should be completed by 2Q12. On its rationalisation plans, the company plans to consolidate its number of plants from 13 to 4-5 globally. (Malaysian Reserve) This is not a new development. The company has already indicated its intention in the past few weeks.
Bandar Raya Developments Bhd (BRDB) has until the end of the month to say whether it is going ahead with the proposed sale of four of its properties or risk a query from the stock exchange, according to sources.
• BRDB had announced on 22 Nov, 2011 that it was postponing the tender exercise for the properties - Bangsar Shopping Centre, Menara BRDB, CapSquare Retail Centres and Permas Jusco Mall - to the first quarter of this year.
• In the November announcement, BRDB had also stated that Ambang Sehati Sdn Bhd, its second largest shareholder, could raise stake in the company, an exercise that may or may not result in a general offer. (StarBiz)

A three year time frame is being set for renewable energy (RE) activities to kick off with expected higher funding and quotas. Minister of Energy, Green Technology and Water Datuk Peter Chin said, “We would like to see a higher level of RE being generated in the future. We have to learn from the current phase before we proceed in a more aggressive manner. We are looking at about three years to see how this RE is performing especially with solar energy for which the cost of solar production is getting lower and lower.”
• He added, “Now we are restricted by the amount in the RE Fund for which we can only collect 1% from each account holder of Tenaga. If the fund is higher, the quota can be increased. That will be good for the country in terms of emission of carbon and the fact that RE is considered a cleaner source of energy.” (Star Biz)

Telekom Malaysia (TM) will consider acquisitions to bolster its capabilities to better serve its small and medium enterprise (SME) customers. Group CEO Datuk Seri Zamzamzairani Mohd Isa said TM is looking to reach out to the SMEs at a fest next month where it hopes to learn about its customer needs and see how its range of services can meet them. “We’re open to possibilities and we’re looking at a more inclusive approach. Rather than doing everything ourselves, we would like to include others as partners.”
• Among other things, TM is looking to tap into the potential of cloud computing and communicate to SMEs how its HSBB can help their businesses expand beyond home grounds. SMEs contributed 26% to TM’s retail revenue of RM7.2bn in FY11.
• TM is also looking to expand in the business process outsourcing (BPO) market. Work is already underway to set up a data centre in Hong Kong, TM’s first outside Malaysia. (Financial Daily)

Telekom Malaysia Bhd (TM) expects to spend about RM1bn on high-speed broadband (HSBB) network next year, as it is banking on it to maintain its broadband leadership. The company, which allocated some RM1.4bn in capital expenditure (capex) last year, expects slightly lower capex this year.
• The project launched in 2008 is a public-private partnership in which TM is investing RM8.9bn over 10 years while the government is coinvesting RM2.4bn. So far, the government has paid RM2.2bn.
• Starting next year, TM will self-fund the continuous rolling out of HSBB network and demand will decide the rollout. (BT)

Boustead Holdings Bhd’s plan to dispose its plantation in Sumatra will see the company focusing on increasing the yield of its plantations in Malaysia, said its deputy chairman and group managing director Tan Sri Lodin Wok Kamaruddin.
• The plantation division contributed about 40% to the company’s profit for its financial year ended Dec 31 2011 but the disposal of the Sumatra plantation will not have any impact on the profits of the plantation division. Lodin expects the price of CPO to hover in the range of RM3,300 per tonne this year. (Bernama)

The Campro charged fuel efficiency (CFE) engine, developed by Proton Holdings, is designed to meet all requirements needed in the markets that the carmaker intends to export. It took 24 months to develop the engine. Not only the engine and transmission were developed but the car designing was packaged as well. The Campro CFE engine is basically a high performance variant of Proton’s Campro engine that is capable of giving power without using larger engines. (Financial Daily)

Bintulu Port Holdings is in final talks with its major shareholders, including the Sarawak government, on the funding for the proposed Samalaju deepsea port project in Bintulu. CEO Datuk Mior Ahmad Baiti Mior Lub said discussion should wrap up in the next three months. The cost of the new port is estimated at more than RM1bn.
• Mior Ahmad said construction works for the new port on 450ha was expected to begin early next year for full completion in 2016. “We will first build interim facilities, including berth for barges which are expected to be ready by end of this year and be operational in early 2013.” (Star Biz)

Perusahaan Otomobil Kedua Sdn Bhd (Perodua) will reintroduce its used-car business, which ceased operations two years ago, by the middle of the year. Its managing director Datuk Aminar Rashid Salleh said the company is in the process of "recruiting the right people both internally and externally" to start the used-car operations to complement its new car business.
• "Profitability will not be our main driver, at least in the first phase. The used-car business is mainly to help our customers trade-in their current vehicles to help facilitate their new car purchase, And we plan to help them to get the best value for their current car," said Aminar. (The Sun Daily)

The conversion of A330 passenger aircraft into a freighter aircraft will not affect the value of new A330 freighter aircraft, says Andreas Hermann Airbus vice-president of freighters. “Historically there has always been new-build and converted freighters and these aircraft address different end-users and end-points of operations. There is no logical reason of why a new-build freighter loses in value because of a conversion programme.”
• Malaysia Airlines (MAS) cited losses at its cargo arm and the recent announcement by Airbus to develop the A330 Passenger-to-Freighter (P2F) conversion programme as reasons to make a RM314 million provision for impairment of freighter aircraft value. According to MAS, the introduction of the conversion programme for the A330 passenger aircraft had depressed the value of its newly delivered A330 freighter aircraft. (BT)

EP Manufacturing Bhd (EPMB) is expanding into the highway concession business with the acquisition of Maju Expressway Sdn Bhd (MESB), the concession owner and operator of the 26km Maju Expressway, for RM1.7bn. In a filing with Bursa Malaysia last Friday, EPMB said the acquisition will be satisfied by the issue of 38.5m new EPMB shares at RM1.30 each (worth RM50m), issue of 100m Redeemable Unsecured Loan Stock (RULS) and RM1bn cash.(The Sun Daily)

Jordone Group Bhd, which specialises in brand building, concept development, fashion designing, marketing, distribution and retailing for casual and business wears, is seeking a listing on Bursa Malaysia Main Market. JGB currently develops, manufactures and markets brands such asSnails Original, Chargers Outfitters, Snails & Sons, Jeep, Feraud, BIEM,and Budweiser.
• According to its draft prospectus submitted to the Securities Commission (SC), the group has proposed an IPO of 10.813m new shares, about 13.52% of its enlarged issued and paid-up capital. A total of 1.8m of these shares will be made available via private placement. (Starbiz)

The Selangor government has sought advice from an international legal firm in London to end the deadlock in its bid to reclaim control of the state's water industry. MB Tan Sri Abdul Khalid Ibrahim said he had a meeting with a team of senior lawyers to discuss legal avenue to find an amicable solution to the matter. (Financial Daily)

Local and foreign manufacturers of branded household appliances are expanding their range of products to meet rising domestic and international demand. Pensonic Holdings Bhd, Daewoo Electronics (M) Sdn Bhd and CT Frank Technology Sdn Bhd are among the companies that are investing to produce a new range of products this year.
• Meanwhile, the latest Business Monitor International report released last month forecast that total retail sales in the country would increase from US$57bn in 2012 to RM70.5bn in 2016, fuelled by low unemployment rate, rising disposable income and a strong tourism industry.
• Consumer electronic product sales are predicted to rise from US$11.5bn in 2012 to US$14.4bn in 2016, an increase of 25.8%, boosted by demand from the tech-literate urban middle class, and by a growing interest in electronic products from the under-penetrated areas outside the Klang Valley. (Starbiz)

Adex gained momentum last month, but the Jan-Feb adex still ended up with a contraction against the same period last year. Advertisers spent RM1.414bn on media space/airtime in the first two months of 2012, down 1.7% from a year earlier. However, media specialists IPG Mediabrands and GroupM expect spending level to improve in the coming months.
• “The timing of Chinese New Year and other holidays in Jan/Feb really slowed down the finalisation of marketing plans at the start of the year. We will start seeing some year-on-year (y-o-y) growth again from April onwards.” said GroupM Malaysia CEO Girish Menon. However, Menon cautioned against expecting a growth rate similar to last year.
• Nielsen data showed that adex jumped by 11.9% in 2011. “Particularly on TV, most clients are holding their spending at last year's levels, so we don't expect to see any growth there,” he added.
• January had seen adex shrink by 5.7% y-o-y, the first monthly contraction in three years. Ad spending began to grow again in February. Advertisers forked out RM640.9m, which was 3.4% higher than in the same month last year. (Starbiz)

Telekom Malaysia will consider acquisitions to bolster its capabilities to better serve small and medium enterprise (SME) customers. Its group CEO Datuk Zamzamzairani said TM is looking to reach out to the SMEs at a fest next month where it hopes to learn about its customer needs and see how its range of services can meet them. SMEs contribute 26% to TM's retail revenue, the second largest after the consumer segment's 34%. Retail contributes to 79% of TM's revenue. (Financial Daily)

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