KPJ buys into Indonesia firm
KPJ Healthcare said its wholly-owned subsidiary Kumpulan Perubatan (Johor) SB has proposed to acquire an 80% stake in Indonesia-based PT Khidmat Perawatan Jasa Medika for RM15.84m cash. The deal would be financed with the group’s internal funds. (StarBizWeek)
KLB names PDagangan partner, supplier of lubricants
Konsortium Logistik (KLB), a logistics service provider has signed a long-term contract agreement with Petronas Dagangan, making the latter its exclusive partner and supplier of lubricants. The new contract would see all KLB’s prime movers and vehicles using Petronas synthetic grade engine oil for five years. KLB CEO Datuk Che’ Azizzudin Che’ Ismail described the partnership as a testament of excellent collaborative spirit between two major players in the Malaysian transportation industry. (StarBizWeek)
Perak Corp unit enters joint venture
Perak Corp subsidiary PCB Development SB has entered into a heads of agreement with Sanderson Project Development (Malaysia) SB (SPDM) for a joint venture to develop and operate an international standard animation theme park, resort hotel and serviced apartments in Ipoh. The project has a gross development value of RM506.7m. The intended equity participation in the joint venture shall be 20% to be held by PCB Development and the balance 80% by SPDM. (StarBizWeek)
Genetec clinches RM28m orders
Genetec Technology, an ACE-listed high-precision engineering design and build specialist, has secured new orders amounting to RM27.9m, bringing its order-book to RM106.4m. Genetec executive chairman Ron Ortscheid said in a statement that the global demand for hard-disk drive had strengthened in tandem with the growing demand for more cost-effective but also ever increasing storage space. (StarBizWeek)
MAS increases regional, long-haul frequencies
Malaysia Airlines (MAS) is offering increased full-service weekly frequencies effective yesterday between Kuala Lumpur and Beijing, Manila, Phnom Penh, Los Angeles, Taipei, Bangkok, Medan and Jakarta, taking advantage of an expected rise in demand on these routes. These sectors will see a gradual increase in total capacity from the current 19,540 seats to 24,820 by 1 May. (Malaysian Reserve)
Malaysia Airlines (MAS) denied claims by an in-house union that it was forcing employees to quit in order to „bulk transfer‟ staff to a new sister airline. MAS said the MAS Employees Union’s (Maseu) allegations were inaccurate and misleading as applications to the still-unnamed short-haul service were completely voluntary. Successful candidates will be offered employment under terms and conditions of the new airlines, including salaries and benefits. It added that over 850 MAS employees had applied to join the new regional off-shoot for a broad variety of positions. (Malaysian Insider)
Malaysia and Indonesia are on a joint mission to correct and update a United States Environmental Protection Agency (EPA) report that could impact future exports of palm-based biofuels. Plantation Industries and Commodities Minister Tan Sri Bernard Dompok described the current EPA report as "errorneous" and felt the need to "come personally to the US" for discussions with senior US officials, saying the EPA data did not reflect the current standards practised in the producing countries. (Bernama)
Wah Seong is believed to have secured a Petronas Carigali contract to coat about 90km of gas pipes in Turkmenistan. Petronas Carigali is one of the main partners in developing the field. The pipe-coating deal is an extension of an existing job that Wah Seong secured in FY08. (Edge Weekly)
Fears that the proposed privatisation of QSR Brands Bhd by Johor Corp (JCorp) and CVC Capital Partners Ltd may fall through may be the reason why the company's share price has been under selling pressure since last week. According to an earlier report, QSR and KFC were expected to call for an EGM by end-March to seek the approval of shareholders for the proposal. However, QSR and KFC have yet to requisition the EGMs. It had been reported that the buyout deal had been proving challenging due to some concerns that Yum! Brands Inc, the licensor and owner of the KFC and Pizza Hut brand names, have over the takeover. However, reliable sources said that some significant progress had been made, with the buyers (namely JCorp and CVC) having had a series of meetings with Yum officials in Singapore over the past few weeks.
The buyout deal is conditional on the approval of Yum! while Lembaga Tabung Haji, being the single largest minority shareholder with a 23% stake in KFC, will have a major say on whether privatisation takes place. “The negotiations are not stalled, it's tough but it's progressing,” one source told StarBizWeek. “The deal will go through, there's a debt to take care off,” the source said. (Starbiz)
Perodua is still open to collaboration talks with DRB-Hicom, the new owner of Proton Holdings, managing director Datuk Aminar Rashid Salleh said. However, he reiterated that the country's largest carmaker is still against any kind of merger between the two entities. Aminar Rashid said it is up to the new owners to decide whether there is a need for a strategic collaboration. (Bernama, Malaysian Reserve)
U Mobile has given six months' notice for the termination of its 2G domestic roaming deal with Celcom. The roaming may be terminated earlier if both parties agree to it. While the identity of U Mobile‟s new partner is unknown, the market talk is that Maxis is the new ally. (BT)
The Federal Government is allowing Selangor to operate the recently completed Labu treatment plant, possibly sending a signal that the water talks could move to more amicable ground. “The Selangor government insisted on operating the plant; otherwise, it would not approve the extraction of water from Sungai Labu,” Minister of Energy, Green Technology and Water Datuk Seri Peter Chin said. The Sungai Semenyih plant is now overloaded in capacity by as much as 40%. The Labu plant will be like a dedicated plant for the KLIA region, bearing in mind that KLIA 2 will be coming up. “We are always amicable to look at the water restructuring exercise in a manner that will benefit consumers,” he said. “But the restructuring proposal has to be a workable one.” “We allowed Selangor to buy out. Go ahead, negotiate with them and buy them out. But they did not offer enough for these people to be comfortable to exit." he said. (StarBiz)
Datuk Seri Najib Razak has approved a RM7.5m allocation for short term flood mitigation measures in Hulu Langat where more than 3,000 families were badly affected by floods early this month. A bridge on a major route that would cost RM3.5bn, two culverts costing RM1m and RM3m for relocation of utilities are covered under the allocation. (Financial Daily)
Malaysia Building Society (MBSB) targets between RM8bn-9bn in total financing disbursements for its Islamic personal financing (PF-i) for this year, CEO Datuk Ahmad Zaini Othman said. Last year, total financing disbursements for PF-I surpassed RM6.5bn, a major increase of 101% from 2010, and the company anticipates similar substantial growth for the segment for this year. “For the past two months, we have already achieved 3% of our target and we are keeping the numbers easy, as we feel the trend and our strategy is right.” (Malaysian Reserve)
An India-based joint-venture bank is close to getting final regulatory approvals to open for business in Malaysia, some two years after receiving a commercial banking license from Bank Negara Malaysia (BNM). India International Bank, a JV between three Indian banks is now awaiting the go-ahead from the central bank to start operations. All systems are in place. The JV is established by Bank of Baroda (40%), Indian Overseas Bank (35%) and Andhra Bank (25%) and is expected to have a total capital of RM300m. (Malaysian Reserve)
Glomac is targeting a 30% profit growth for FY12 backed by strong take-up rate in its current development projects and high unbilled sales of RM588m. CEO Gerard Tan Boon Chuan said the take-up rate for most of its projects in townships in the Klang Valley is above 75%. “We believe our RM500m sales target for FY12 is on track with consistent sales as well as other projects worth RM4.5bn in GDV in the pipeline. Moving forward, Glomac expects to record about RM6bn in GDV over the next six to eight years.” (Bernama)
When Malaysians go on the Internet for news, The Star Online (thestar.com.my) is still the top destination, according to the latest data released by the Malaysian Digital Association (MDA). In the association's top 30 list of local and international websites visited by users within Malaysia, The Star Online occupies the No. 9 spot. It is ahead of other news portals such as Malaysiakini.com (No.11), themalaysianinsider.com (No.23), and the online versions of Harian Metro (No.15), Utusan Malaysia (No.16) and Kosmo! (No.28). The top five in this combined list are all familiar names facebook.com, google.com.my, local online marketplace Mudah.my, yahoo.com and youtube.com. (Starbiz)
Automotive industry players and observers are still maintaining a „wait-and-see‟ approach about the impact of Bank Negara‟s responsible lending guidelines on total industry volume (TIV) for this year. “We will relook the TIV forecast for 2012 when we hold our half-year review sometime during the third week of July,” said Malaysia Automotive Association (MAA) president Datuk Aishah Ahmad. The MAA had forecast TIV to grow 2.5% to 615,000 units this year. Kavan Mukhtyar, of Frost & Sullivan also said he was maintaining his TIV forecast of 612,000 units as they had already factored in the tightening of lending rules as one of the market restraits for 2012. (Star Biz)
Tanjung Offshore is going back to basics focusing on its core strengths in offshore support vessels, maintenance services and engineered equipment supply to bring the company back to the black for FY12. MD Omar Khalid said the company had been involved in too many different business activities, which distracted from its core strengths and focus. “With the largest network of workshops located throughout Malaysia dedicated to servicing offshore oil and gas clients, our maintenance division is posed to leverage off stronger expected activity in the industry.” On the ongoing business review and rationalisation, Omar said this would involve divesting loss-making businesses and reabsorbing businesses into a nucleus company, thereby enabling them to reduce fixed overhead costs. (Star Biz)
Masterskill group CEO Datuk Seri Edmund Santhara bought more shares the company, forking out some RM7.7m to mop up 7m shares at a price of RM1.10. This acquisition raised his shareholding in the company to 23.81% or 97.6m shares. (BMSM, StarBiz)
AEON Co (M) MD Nur Qamarina Chew Abdullah told The Edge Financial Daily of the group‟s strategy to further expand its reach in Malaysia and how its aggressive rebranding exercise will help strengthen its name in a regional context. The group, which is in the midst of entering the northern region in a big way, will launch two new malls in Perak – Sri Manjung and Ipoh and has aquired land in Kedah and Penang worth RM86m, with plans to develop these sites into malls by 2014. It also purchased land in Johor for RM22.2m. AEON plans to spend RM15m in the next 2 years on the rebranding exercise to move away from the long-time Jusco brand that Malaysian consumers are accustomed to. The rebranding is not only aimed at promoting the group‟s new image to be aligned with its corporate identity but as a means to enter other emerging markets like Cambodia, Indonesia and Vietnam. “The potential of ASEAN is huge. The ASEAN office is based here in KL. ” said Chew. On whether AEON, which is 51% owned by AEON Group Japan will take part in those regional moves, Chew said that all regional expansion decisions will be determined by the parent company. (Financial Daily)
Petronas Dagangan: Named as KLB’s partner and supplier of lubricants Konsortium Logistik Bhd (KLB), a logistics service provider has signed a long-term contract agreement with Petronas Dagangan making the latter its exclusive partner and supplier of lubricants. The new contract would see all KLB's prime movers and vehicles using Petronas synthetic grade engine oil for 5 years. KLB is one of Malaysia's leading logistics company with 28 years of experience in logistics operations. (StarBiz)
MAHB: KLIA aviation hub of Southeast Asia?
At a recent press conference, MAHB CFO, Faizal Mansor said the construction of KLIA2, which is the largest low-cost carrier terminal (LCCT) in the world with an annual capacity of 45m passengers will make KLIA one of the aviation hubs in Southeast Asia. Faizal said this is one of the reasons MAHB is building a bigger and grander KLIA2, with the aim of serving the booming low-cost carrier industry. KLIA2, slated for opening in Apr 2013 will cost between RM3.6bn and RM3.9bn, almost doubles its original cost estimate of RM2bn. Group MD Tan Sri Bashir Ahmad said MAHB has made several changes to KLIA2, involving a longer runway and bigger floorspace. (Financial Daily)
GuocoLand Malaysia: Expects 18% yield from PJ City, PJ Corp acquisitions
GuocoLand Malaysia expects a firm yield of 18% from the recent related party transaction to purchase PJ City Development Sdn Bhd and PJ Corporate Park Sdn Bhd from Guoline Asset Sdn Bhd and MPI Holdings Sdn Bhd respectively. GuocoLand will buy PJ City for RM29.79m from Guoline Asset; and will then purchase PJ Corp from MPI Holdings for RM258,000. These companies house developments which are mainly parked under PJ City, including commercial land of 3 acres which already has existing buildings on them as well as an industrial land of 7.75 acres fronting Jalan 225, PJ. GuocoLand said it would develop the industrial land for factories after tenancy agreements for the open air carpark and the cement batching plant expires on Mar 31, 2012. The shareholder statement said the purchases of PJ City and PJ Corp would be funded entirely from borrowings which would increase its gearing ratio basing on its shareholders’ funds from 1.13 to 1.20. (StarBiz)
Proton: Perodua still open to tie-up
Perusahaan Otomobil Kedua Sdn Bhd (Perodua)’s MD Datuk Aminar Rashid Salleh said the company is still open to collaboration talks with DRB-Hicom, which is the new owner of national carmaker Proton Holdings. However, he reiterated that the country’s largest car maker was still against any kind of merger between the two entities. Aminar Rashid said that there was a proposal for the two national auto makers to merge but after it was rejected by both Proton and Perodua, the International Trade and Industry Ministry came up with several areas of strategic collaboration However, Aminar Rashid said it was up to the new owners to decide whether there was a need for a strategic collaboration. (StarBiz)
UOA Development: Banks on strategic projects
Pursuing pocket developments in mature neighbourhoods will be the forte of UOA Development to build up a stronger presence in the Klang Valley property market. UOA COO (development) David Khor says the company is looking for opportunities to tap new growth markets like Penang and Johor. However, he said UOA is not in a hurry to ramp up its gearing as it prefers to acquire strategic parcels. Khor says the 40 acres of undeveloped land in Bangsar South and another 60 acres in other parts of the Klang Valley will keep the company busy for the next 7 years. He also said it is their strategy to continue with the business model of having smaller parcels of land and building good quality projects at their own pace, instead of rushing through projects which may compromise on quality. He says the other option is for the company to form joint ventures with landowners, and preliminary negotiation is underway for two potential sites in the Klang Valley. (StarBiz)
Glomac: Sees 30% profit growth
Glomac’s COO Tan Boon Chuan said the company is on track to grow its net profit by 30% in this fiscal year ending Apr 30, 2012. Tan is confident of a better showing this year based on strong take-up rates for its properties as well as a high unbilled sales of RM588m. For the current financial year, Glomac is set to launch about RM1.5bn worth of properties with a sales target of RM500m. Next week, the developer is slated to launch the RM270m Reflection Residences located in Mutiara Damansara. Tan said Glomac has close to RM6bn worth of property projects that would keep the company busy for the next 8 years. (Business Times)
Syarikat Takaful Malaysia: Spending RM5m to go paperless
Syarikat Takaful Malaysia (Takaful Malaysia) is investing up to RM5m to convert all its documents into paperless processing by the end of this year. The Islamic insurer on Friday launched a cutting-edge technology - Document Management System - with its technological partner, Serial Data Sdn Bhd. Takaful Malaysia's new system integrates two software solutions marketed by Serial Data over the last one year. The two software solutions, namely Readsoft and Onbase, are deployed in both Takaful Malaysia's individual and group family operations, covering the end-to-end process cycle. Takaful Malaysia is the first insurer in Malaysia leveraging on the system. It expects to fully execute the plan by year-end. In going paperless, the company anticipates cost savings of up to RM1m annually. (Business Times)
Texchem Resources: Focuses on high growth segment
Having unlocked value in its household insecticide segment, Texchem Resources is keen on doing the same for its other business segment to return to profitability. Its CEO, Tan Peng Lam said the group will concentrate on its profit-making and high growth segments – the polymer engineering, restaurant and industrial divisions. Apart from the three divisions, the company has also food, family-care and venture incubation business. (Financial Daily)
AIC Corporation: LTAT to seek board seat on Temasek Formation
According to sources close to the deal, Lembaga Tabung Angkatan Tentera (LTAT) will seek a board seat on the soon-to-be listed Temasek Formation, following the acquisition of 20m shares or 11.5% stake in AIC Corporation. The source said LTAT had last Wed acquired the block of shares at RM1.40 a share from major shareholders of AIC, primarily Datuk Goh Tian Chuan. One of the conditions for the block sale was for LTAT to get a board seat on the merged entity and Goh is agreeable to this. (Financial Daily)
Automotive: MAA says new rules already impact sales of new vehicles
New rules mean new consequences and the first industry to raise its displeasure over new funding guidelines was the auto industry. Their concerns were stoked by a steep drop in sales in Jan and was echoed by Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad. According to reports, loan applications for the purchase of passenger cars contracted by 15.5% y-o-y in Jan from 7.8% y-o-y growth in Dec 2011. Aishah says while the MAA commends Bank Negara's action in promoting prudent and responsible financing practices among local financial institutions, she however feels that imposing more stringent financing conditions for hire purchase loans under the present economic environment will not help to stimulate the market and instead make it worse. (StarBiz)
S&P downgrades MISC credit rating
Standard & Poor’s Ratings Services (S&P) had lowered its long-term corporate credit rating on energy shipping company MISC Bhd to BBB from BBB+ with a negative outlook. S&P had also lowered its issue rating on the US$700mil 6.125% senior unsecured notes due July 1, 2014, issued by MISC Capital (L) Ltd to BBB from BBB+ where MISC fully guaranteed the notes “We lowered the rating on MISC because the company’s weak operating performance has undermined its cashflow protection, as reflected in weaker credit ratios," said its credit analyst Abhishek Dangra in a statement. (Source: Business Times)
Major breakthrough for Deleum
The provider of oilfield equipment and services is partnering Petronas Carigali Sdn Bhd to form a global patent for a breakthrough product that will greatly improve oil extraction rates, say sources. (Source: The Edge)
SC: No basis for further action over E&O, AirAsia
The Securities Commission (SC) says it has found no basis for further action in its probes into the trading of shares of Eastern & Oriental Bhd (E&O) and AirAsia Bhd prior to the listed firms' respective deals. The SC had set up an independent committee consisting of two senior independent commission members to supervise the review in the case of E&O. The SC also said that it had conducted a review on the trading of shares in the runup to the announcement of the Malaysia Airlines-AirAsia share swap and collaboration agreement on August 9 2011, and of Sime Darby's 30 per cent purchase of E&O on August 29 2011. "Based on the SC review and the opinion of the market expert, the SC found no basis to take further action on the AirAsia share transactions," it said. (Source: Business Times)
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