This development ties in with recent newsflow indicating the Selangor state government’s unsuccessful attempt to take over and consolidate all water concessionaires in the state. The state government had given the Federal Government via PAAB the “greenlight” to proceed with their take over plans which started with the due diligence/asset verification that is expected to conclude soon. Though the lapsed offers by the state government to Abass and Splash is a slight disappointment and pours cold water on the excitement over the acquisition play in Selangor, we continue to believe that PAAB’s take over structure carries a greater chance of success as O&M agreements will be retained with the water operators. This would be a more attractive proposition to Puncak Niaga, who had rejected the state government’s previous two offers. New offers by PAAB are unlikely to be lower than the state government’s offers as they are likely to be rejected. Concession agreements (CA) gives legal grounds for concessionaires to realise the “full value” of their businesses in the event of an acquisition. PAAB’s could make its move earliest towards end-09 if not in 1Q2010.
The sale of cigarettes in packets of less than 20 sticks will be prohibited effective June 1 next year. Health Minister Datuk Seri Liow Tiong Lai said that in line with the decision, cigarette companies had been given seven months from now until May 31 next year to dispose off its stocks of cigarettes in packets of less than 20 sticks in the market. "The government will not entertain any appeal on this matter and the Health Ministry will enforce the ban fully on the manufacture and sale of cigarette packets containing less than 20 sticks beginning June 1, 2010," he said. He said the decision had been agreed upon by all the cigarette companies and the government was thankful for the support and cooperation rendered by these companies. Liow said that following the enforcement of the ban, anyone found guilty of violating the regulation was liable to a fine of not more than RM10,000 or imprisonment for a period of not more than two years. (Bernama)
The ban on the higher margin small packs is negative for tobacco players. But with a clear and definite June 1 timeline for the ban, tobacco players can now start making the necessary preparations. According to our preliminary estimates, the ban is likely to have a bigger impact on British American Tobacco (BAT) relative to JT International (JTI) given that BAT has a bigger exposure to small packs.
Speaking in an interview, Sheldon Adelson, chairman of Las Vegas Sands, said the company’s Singapore casino will open on schedule at end-1Q 2010, adding that “we’ll known better in about a month because we would have lifted all the components for the Sky Park”. On potential cannibalisation between Singapore and Macau, he said “We don’t believe in it. If there is, it will be so small, it won’t be a material consideration but you never know. It all depends on whether Genting Singapore does. We don’t want to steal business from Macau. We believe there’s plenty of business from that part of the world to get along without one person from Macau.” (Bloomberg, Financial Daily)
The Energy Commission (EC) will soon not only have a chairman but also a CEO, both of whom will be appointed by the Energy, Green Technology and Water Minister. The addition of a CEO’s post for the EC will come about once the bill is passed and amendments to the Energy Commission Act 2001 are enforced. The EC has yet to appoint a new chairman following the demise of Datuk Pian Sukro a month ago. According to sources, few names have been bandied but non has yet to be confirmed. (Starbiz)
One Taiwanese businessman, who had recently toured the states of Sarawak and Penang in a "private capacity", said "I believe Malaysia would be a good partner for Taiwan for cooperation in energy issues. The Malaysian Industrial Development Authority, which promotes investments to and from Malaysia, could look to foster closer cooperation with Taiwan whose energy-specialised companies are earmarking large sums for R&D to produce innovative technology for this sector. (Bernama)
Trading in Sarawak Energy's shares will be suspended on Dec 8 following the offeror’s acquisition of a 97.35% stake in the company as at yesterday. The offeror has no plans to maintain the listing status of the company. (Starbiz)
MMC Corp’s unit, Malakoff Corp is always looking for opportunities to expand and does not rule out potential M&As, said MD and CEO Ahmad Jauhari Yahya. But in considering its options, the key issue was ensuring operational competitiveness, he added. Jauhari strongly denied a recent news report that Malakoff was planning to buy a substantial stake in Jimah power plant. (Starbiz)
India’s armed forces will undertake a second round of vacation of 3G airwaves in Jun 10, the defence ministry has assured the Department of Telecom (DoT). In Oct 09, the armed forces had vacated 10 MHz, or two slots of 3G spectrum to be used for commercial telephony, and the defence ministry has now said an equivalent amount will be freed up in June-July 2010. The agreement by the defence forces implies that DoT will have additional 3G spectrum to conduct a second round auctions in late-2010, if the government decides to do so. Besides, DoT can also ensure that all that there will be four 3G operators in all the telecom circles. (Economic Times of India)
After more than doubling from 2,163 points in September to 4,661 points on 19 November, the Baltic Dry Index has been falling over the past two weeks with slower cargo activity and weaker sentiment taking their toll. The index closed at 3,836 points yesterday in an eighth straight session of falls.
- Brokers said the weaker sentiment had been driven by less appetite to hire larger capesize vessels, which typically haul 150,000 tonne cargoes such as iron ore and coal, especially in Far Eastern markets.
- 'Given the strength in the steel markets, we expect the dry bulk market to avoid a drop all the way back to late summer levels, although it is evident that charterers have stepped back from the market for the near-term,' Dahlman Rose & Co said, referring to the capesize index. (Reuters)
From next week, travellers on Malaysia Airlines can book air tickets and check in using their mobile devices. Several global airlines, including AirAsia, Turkish Airlines, Finnair, Southwest Airlines and Ryanair, offer this service for the convenience of their travellers. The move to offer mobile booking and check-in is part of an ongoing effort by the airline to upgrade its passenger service system. It is investing RM480m over a 10-year period, beginning in 2006, for that and has engaged aviation IT specialist SITA for assistance.(Star)
Proton Holdings will export Exora to Australia and Middle East next year and launch its first model in India in 2011 as its aims for a 50% export of its total production within three years. Its MD, Datuk Syed Zainal Abidin Syed Mohamed Tahir, said Proton exported about 24%, or 26,000 cars, in financial year 2009/2010 and hoped to sell over 40,000 next year. On India, which he considered a strategic and important market, Syed Zainal said Proton was expected to announce its local partner early next year and the first car would roll out within a year. (Bernama)
Mah Sing Group has fixed the issue price of its proposed private placement at RM1.55/share, which represents a 10% discount to the VWAP of RM1.72. (Financial Daily)
Salcon signed a cooperation agreement yesterday with the local government of Yizheng City in Jiangsu province, China on water and wastewater integration projects in the city and its neighbourhoods. Salcon said the water and wastewater works include planning, operation and maintenance, laying of pipe networks, management of wastewater and recycled water within the Yizheng City administrative area. Salcon said an agreement (JVA) had been signed by its wholly-owned Salcon Jiangsu (HK) Ltd and Yizheng City & Rural Water Co Ltd to incorporate a joint venture company know as Jiangsu Salcon Water Environment Development Co Ltd. (Financial Daily)
Kim Loong Resources plans to buy a 60% stake in Sarawak’s Tetangga Akrab Pelita (Pantu) Sdn Bhd for RM25m, to increase its land bank for oil palm plantation. The deal is expected to be completed by Jan-2010. (BT)
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