Tuesday, November 6, 2012

20121106 0930 Malaysia Corporate Related News.

SapuraKencana has entered into a non-binding agreement to acquire Seadrill’s tender rig business for an enterprise value of US$2.9bn to be satisfied by a mix of shares and cash, a move that will see the former becoming a leading global player in the tender rigs and semi-tender rigs market. Seadrill will receive a minimum of US$350m in new shares of SapuraKencana that will double up Seadrill's stake in the company to 13% from the current 6.4%. Seadrill will further have the right to nominate two members to the SapuraKencana board of directors (including one alternate). Seadrill's chairman John Fredriksen is expected to be one of those members. The enlarged tender rig business under SapuraKencana will comprise 16 tender rigs in operation (including the KM1 rig currently owned by SapuraKencana), five of which are already 51%-owned and managed through its existing joint venture with Seadrill in Varia Perdana and Tioman Drilling Company and an additional five units currently under construction (newbuilds). SapuraKencana will also be offered the righst to be the manager for three further tender rigs which are not part of the transaction. The operating rigs and newbuilds are all currently contracted under long-term fixed price contracts with companies such as Chevron, Shell, PTTEP, and Petronas Carigali. The total order backlog amounts to US$1.55bn as of end-Oct where the majority of the operating rigs are currently deployed in South-East Asian waters. (Star)

Malayan Banking officially opened its first branch in Laos yesterday, marking the completion of its footprint in all 10 Asean member countries. Prime Minister Datuk Seri Najib Razak officiated the opening in the capital city Vientiane's main financial centre known as Chanthabouly District. The branch will offer a full range of services, including retail and business banking, foreign exchange, remittances, treasury services as well as automated teller machines. (BT)

For CIMB Group Holdings’ proposed acquisition of selected investment banking businesses of The Royal Bank of Scotland (RBS), the purchase of RBS’ selected cash equities, equity capital markets and M&A corporate finance businesses in Australia has been completed on 2 Nov 12. (BMSB)

Alam Maritim (M) Sdn Bhd, a wholly-owned subsidiary of Alam Maritim Resources, has received a letter of award from Carigali Hess Operating Company for the provision of one unit anchor handling tug supply vessel. The contract is valued at USD7.04m and will commence in Mar 2013. The contract is for a firm period of 21 months with no specific provision for extension option. (BMSB)

MRT Corp said Bumiputera initiative for the MRT SBK line is firmly on track. To date, 45% of the total value of work packages, which have been awarded to Bumiputera companies, exceeded the initial target of 43%. Haris Fadzilah Hassan, director of Stakeholders and Land Relations of MRT Corp, said to date contracts to the value of RM8.8bn have been awarded to Bumiputera contractors. To date, 53 of the 85 MRT works packages have been awarded, with a total value of RM19.8bn. The remaining 32 packages are expected to be awarded by the end of the year. (BT)

UMW Singapore Ventures Pte Ltd, a wholly owned subsidiary of UMW Holdings is divesting its entire 60% stake in Offshore Construction Services Pte Ltd (OCS) to Mr Neo Teck Seng for a total consideration of SGD7.1m. The valuation is based on NTA plus 5%. OCS provides fabrication services to the marine industry. Mr Neo is a Director of OCS and currently holds the remaining 40% of the company. The disposal is in line with UMW's strategy to rationalise
its Oil & Gas investments and it will not have any material effect to 2012 earnings and NTA of the group. (BMSB)

Muhibbah Engineering (M) Bhd, the main subcontractor of the failed Asia Petroleum Hub (APH) venture, will meet the official receiver (OR) appointed by the court next Monday, said its managing director Mac Ngan Boon. Mac said it will meet the OR together with other contractors and some 20 creditors of the RM2bn project, which may include CIMB Bank Bhd, previously the lead financier of the project. "We will meet with the OR, who will talk to the creditors and see what can be done," he said. Mac believes that the APH project is still viable, saying many interested parties are keen to participate in it and that Muhibbah is confident in Southern Johor as an oil and gas storage terminal. "The project will go on in some form or another. If everyone and the banks (creditors) agree, restructuring is the best way for us. "We want to see a restructuring and finish the job. We are willing to be a shareholder (of APH)," he added. He said Muhibbah is willing to inject money and take initiative to revive the project, but the amount of money needed would depend on the parties that would want to participate. "We hope they would look towards a restructuring, but if they (creditors) decide to sell, we can't do anything." (Sun)

Malaysian Airline System (MAS) is close to finalising its RM9bn funding plan with a somewhat similar arrangement made in 2002 when it embarked on its Widespread Asset Bundling (WAU) to keep the airline afloat. Industry sources say the government, through Ministry of Finance, has set up a special purpose vehicle (SPV) to absorb the airline's six new Airbus A330s valued at RM5.3bn. The SPV will raise RM5.3bn to purchase the aircraft and lease them back to the national carrier. (Financial Daily) Malaysia Airports (MAHB) will create a new brand identity - "Sama-Sama" - for all the hotels it owns and grow the commercial business as outlined in its five-year business direction. MAHB said the immediate plan for the brand creation will involve three hotels - the existing landside hotel, KLIA Air Transit Hotel and KLIAS2 Air Transit Hotel that will be ready in May. (Bernama)

Tan Sri Tony Fernandes has teamed up with Renault to design, develop and build future sports vehicles including SUV and city cars that are affordable to the mass market. The first car will roll out from production line in 2015. Fernandes' Caterham Group and Renault ASA signed a deal in which both parties would have equal stake in a new JV. There will be two manufacturing hubs, one each in France and Malaysia. (Star Biz)

Malaysian company Giant Consolidated Ltd (GCL) is set to play a major role in transforming the face of Laos' transportation system with the construction of a 220km electrified double track railway. The project is estimated to cost US$5bn. This will be the largest investment made so far by a Malaysian company in Laos. GCL director Tock Min Kin said the company has been awarded a 50-year concession to construct and operate the railway project. (Star Biz)

The Ministry of Plantation Industries and Commodities will set up a committee with France's Agriculture Ministry to help Malaysia's palm oil products gain access to the French market. Minister Tan Sri Bernard Dompok said he had been in Correspondence with France's Agriculture Minister and was still waiting for a response. (Financial Daily)

Prominent corporate lawyer Datuk E Sreesanthan, who was in the news recently for seeking re-election to the board of Sime Darby despite facing insider trading charges, said he was doing so because he has a lot to contribute to the company. He said he was also driven by an interest to see the conglomerate reach its full potential. (StarBiz)

REDTone, a postpaid mobile virtual network operations (MVNO) company, expects to get 100,000 new customers next year, supported by its news business partnership with Ezzy Mobile Sdn Bhd. Its COO Ben Teh said 20% will come from its soon-to-be launched product in collaboration with Ezzy Mobile, namely Ezy2Duosim. “Since the re-launch of REDTone in June, we have managed to get 10,000 customers and we are confident that the numbers will grow in time." said its COO. Meanwhile, Ezzy Mobile CEO Sivalingam Thechinamoorthy said the company was also in the midst of talks with regional telcos to implement the same technology. “Under this plan, we expect to provide the ability for consumers to have seven different countries’ numbers regionally in one SIM card with local rates. We expect this plan to be concluded by next year,” he added. (StarBiz)

Ayamas Food Corporation has clarified that it does not use chloramphenicol or any other banned antibiotics in its products. Rosniza Baharum, General Manager, Group Corporate Communications, expressed surprise at the suspension of the importation of certain Ayamas poultry products into Sarawak by the State Veterinary Authority following the detection of chloramphenicol in a sample of an Ayamas chicken frankfurter. "Our routine internal tests also do not reveal any evidence of usage of such antibiotics in the raw materials we use," she said in a statement. (Bernama)

Shareholders of KFC Holdings (M) Bhd (KFCH) have voted in favour of its privatisation, with some 99.1% agreeing to the sale of its business to Massive Equity at its EGM on Monday. KFCH also received 99.7% acceptances for the proposed capital repayment of RM4 per share and RM1 per warrant. All votes were counted by poll. A second EGM commenced at 2.30pm for the warrant holders to vote on the proposed RM1 capital repayment. A spokesperson from Massive
Equity told journalists on the sidelines of the EGM that the board of KFCH might "revisit" the possibility of a dividend payout if the capital repayment is not completed by year-end. However, this would not affect the offer price from Massive Equity, the spokesman said. Both minority shareholders and the Minority Shareholder Watchdog Group raised the issue of dividends at the meeting this morning, saying the offer from Massive Equity had put a "straight jacket" on KFCH's share price for the past one year, while peers such as Berjaya Food Bhd had seen its shares appreciate over the same period. (Starbiz)

Malaysian Biotechnology Corp (BiotechCorp) CEO Datuk Dr Mohd Nazlee Kamal said the industry, now in its commercialisation phase, had been progressing at a steady rate. It has mobilised most of its potentials to ensure the transformation of the nation into a stable high-income nation by 2020, he said. “The targeted investment for phase 2 is RM9bn. However, I am happy to say that we have indeed surpassed the investment target for phase 2. Just for 2011 and 2012, we’ve successfully attracted a total of RM12.72bn in investments for the biotechnology industry,” he told. (Bernama)

Plans are under way for electronics manufacturer Ya Horng Electronic (M) (YHE) to be taken private via a proposed selective capital-reduction and repayment exercise to all shareholders at cash consideration of RM1.10 per share. “The proposed selective capital-reduction and repayment exercise will be funded via internally-generated funds from YHE and its subsidiaries based on its available cash and cash equivalent,” it said. Accordingly, the entitled shareholders would receive a total capital repayment in cash of RM25.4m. (StarBiz)

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