20100309 1008 Malaysia Corporate News.

Latexx Partners announced yesterday that the company and Budev BV have fulfilled all the conditions precedent as provided in the JV Agreement entered by both parties on 8 Jan 2010. Latexx said that with the conditions precedent fulfilled, Total Glove S/B, its wholly owned subsidiary, has on 8 March 2010 entered into a licensing agreement with Budev for the granting of the exclusive right to use the method for the treatment of latex examination and surgical gloves to reduce the levels of proteins and allergens to nondetectable level to prevent users from having an allergic reaction.
This includes the machines and equipment required to use and implement the method, all know-how, technical assistance and intellectual property rights of Budev related to the method. The granting of license in relation to the treatment of latex surgical gloves is subject to payment by Latexx to Budev of a sum of €0.5m for a period of five years. The licensing fee will be financed using Latexx's internally generated funds and/or financing from banks or financial institutions. (BMSB)
This announcement ties in with the company's earlier guidance to complete the JV agreement by Mar-10. We view this development positively as it is also in line with the company's target to move towards the premium glove segment. The new method is expected to further boost Latexx's earnings and margins from 4Q10 onwards. The agreement is expected to also benefit the company in terms of technological boost and a competitive advantage in the global market.

Banks have begun raising their base lending rates (BLRs) following Bank Negara’s move to lift the overnight policy rate (OPR) by 25 basis points last week. Malayan Banking (Maybank) and CIMB Bank were the first two banks to announce their interest rate hike from 5.55%. The two banks raised their BLR and base financing rates to 5.8% effective today following Bank Negara’s OPR revision last Thursday.

• Maybank president and CEO Datuk Seri Abdul Wahid Omar said the interest rate revision was based on the recent adjustment in the OPR. “We expect to see better growth from our core business segments, leveraging on the improving economic environment and as more customers take advantage of the diversity of our product and service offerings,” he added. 
• Public Bank will also raise its BLR to 5.8% today, according to Bank Negara’s banking info website.
• “We are supportive of Bank Negara’s move to normalise interest rates as the economy regains stability and are immediately transmitting it to both savers and borrowers,’’ said CIMB group chief executive Datuk Seri Nazir Razak. Nazir said it was the right time to raise interest rates as the economic environment had normalised and growth momentum was strong. CIMB also raised its savings and fixed deposit rates by up to 25 basis points.
• The RHB banking group also raised its BLR for RHB Bank to 5.8% today. Group managing director Datuk Tajuddin Atan said RHB would be balancing the increased borrowing rates by offering more competitive rates for depositors.
• Hong Leong Bank will increase its BLR to 5.8% effective March 10. (Starbiz)

Kuala Lumpur Kepong (KLK) expects a sharp rise in plantation earnings in 2QCY10, helped by higher crude palm oil (CPO) prices, a senior company official said yesterday. KLK expects average CPO price realised to rise by more than half in January-March from a year earlier, said group plantations director Roy Lim.

• "For the 2Q, we are looking at about RM2,400-RM2,500 average, that will be a big improvement," Lim said, adding that the average CPO price realised in the same 2009 period was RM1,500-RM1,600 a tonne. The price outlook for the tropical oil, widely used as a cooking oil in Asia, may be capped at RM2,800 a tonne in the next three months, said Lim. 
• "Although some people are more bullish, I think we have to take cognisance of soyaoil supply slowly coming into the market, also you have to look at the global economy, which is not really fantastic," Lim said.
• KLK chief executive officer Datuk Seri Lee Oi Hian flagged a cautious outlook for the group's manufacturing and retailing business in 2010. "Things are getting better, but I think capacity is also a big issue, especially in the basic oleochemicals. There are too many plants come on stream," Lee said.
• KLK wants to expand into China as part of its long-term growth plan and may start a greenfield project there next year, said Lee. It now has operations, mainly in the oleochemical sector, in Zhangjiagang and Shanghai. (Reuters)

Malaysian Airline System’s (MAS) renounceable rights issue of 1.67bn new shares were oversubscribed by 7.67%. Based on the applications received at the close of the rights issue on March 3, the total valid acceptances and excess applications received were 1.8bn rights shares, amounting to RM2.88bn. MAS plans to utilise the RM2.67bn proceeds for the acquisition of wide-body aircraft and working capital. (BT)

LCL Corp has entered into a memorandum of agreement with Axis Global Capital S/B for both parties to enter into discussions and negotiations for the restructuring of LCL via a corporate exercise to be determined later.

• Axis is involved in areas such as interior design and fit-out services, corporate and brand identity consultancy services and property development. It is one of the largest interior design practices in Malaysia servicing various industries from corporate, retail, commercial and government organisations. 
• The Axis Identity Group is currently actively pursuing projects in the South East Asia region, Middle East namely Qatar and Kuwait as well as property development in Papua New Guinea. (BMSB)

YTL Corp's wholly-owned subsidiary, YTL Hotels & Properties S/B (YTLHP) acquired 100% equity in Niseko Village K.K. (Niseko Village). Niseko Village owns Niseko Village Resort which is located at the foothills of Mt. Niseko An’nupuri with scenic views of Mt. Yotei.

• The resort occupies approximately 617 hectares of land comprising 462 hectares of owned freehold land on which are situated the 506-room Hilton Niseko Village, 200-room Green Leaf Hotel and two 18-hole golf courses and 155 hectares of leased ski mountain land on which are situated seven ski lifts and 15 ski trails. 
• The resort is part of a collection of four ski resorts, known locally as Niseko United that surround Mt. Niseko An’nupuri. (BMSB)

Pantech Group Holdings will set up its first overseas factory in Saudi Arabia to produce carbon steel fittings for use in the oil and gas industry. Locally, it expects to complete building a new RM80m plant in Pasir Gudang, Johor, to produce stainless steel pipes and fittings by end-2010.

• Within three years, it plans to produce pipes and fiitings based on alloy there, company executives said. These products are at least 10x more expensive than those made of carbon, they added. 
• Executive chairman Datuk Jimmy Chew said the Saudi plant may be located in Damman, costing an initial 10-15m riyals (RM9- RM13m).Pantech will jointly own and develop the factory with a Saudi firm Al-Otaishan Trading Group on a 49:51basis. (BT)

UOA Real Estate Investment Trust (REIT) is considering buying two office blocks in Kuala Lumpur for RM500m. It received an offer from UOA Holdings, a substantial unitholder in UOA REIT, for the sale of Parcel B Menara UOA Bangsar and Wisma UOA Damansara II, priced at RM289m and RM211m respectively.

• Parcel B Menara UOA Bangsar, located in Jalan Bangsar Utama 1, comprises a tower block with 15 levels of office space, three levels of retail podium, six levels of elevated car park and four levels of basement parking. The newly completed commercial and retail property, which has a 99-year leasehold tenure, is 88.5% occupied. 
• Wisma UOA Damansara II, located at Changkat Semantan, comprises a 16-storey office building and five levels of basement parking. The two-year-old freehold property, used for commercial and retail purposes, is 87% occupied. (BT)

Petronas signed a sales agreement with Sarawak Shell and Petronas Carigali for gas to be produced from three fields in Block SK308 offshore Sarawak to meet the needs of of the MLNG Tiga plant within the Petronas LNG Complex in Bintulu. (BT)