20100325 1130 Malaysia Corporate News.

Splash, which is 40% owned by Gamuda, is making a cash offer of RM10.8bn to the federal government and the Selangor state government to take over all the water concessionaires in the state. Splash indicated that it was compelled to bring closure to the impasse that has lasted more than three years.

• It proposes that the water tariff rate remain at the current level, with only a 2-3% annual increase or 9% every three years. Tariffs will be 35% lower than Syabas’s tariff as there is no need to implement Syabas’s 37% water tariff hike. 
• Upon the takeovers, Splash will be solely in charge of the combined operations and maintenance (O&M), including the operations of the water distribution and will require a 30-year concession period from 2010. Splash will undertake future capex and opex of the entire operations but stated that capex related to the Interstate Water Transfer Scheme (IWTS) will be borne by PAAB. (BMSB)

Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said the government has agreed to implement in stages, the mandatory sales of biofuel from June next year. The programme involving a blend of 5% palm oil-based methyl ester and 95% petroleum diesel, would be implemented in Selangor, Kuala Lumpur, Putrajaya, Southern Perak, Western Pahang, Negeri Sembilan, Melaka and Northern Johor.

• The government made the decision on the implementation of the biofuel programme, tagged, the "B5 Programme" on 17 Feb this year. Dompok said oil companies had requested the government to implement the mandatory sales of biofuel beginning June next year, as they needed time to plan their capital expenditure to sell this type of fuel. (Bernama)

Pakatan Rakyat (PR) would urge the federal government to revoke approvals given to NFOs to hold special draws and reduce the number of weekly ordinary draws from three times a week to twice a week to curb gambling in the country. DAP Youth chief Anthony Loke said PR would send a memorandum to PM Datuk Seri Najib Razak and hoped that all MPs would give bipartisan support for the proposal. (Financial Daily) Although special draws are allocated at the discretion of the government, such allocations have been an annual feature in recent years. The NFOs have promoted special draws as a more effective way to pad the government’s tax coffers than tax hikes.

Malaysia has asked petroleum companies to bear the extra cost of selling diesel blended with palm oil from Jun-11 to kick-start sales of the green fuel after a four-year delay. The country has struggled to implement a mandate to push the blended fuel and support the palm oil industry that was first introduced in 2007 as the government was reluctant to subsidise biofuel blends to match diesel prices at the pump.

• Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said the green fuel, a blend of 5% palm and 95% diesel petroleum, will be introduced in stages in the central states in Peninsular Malaysia. 
• "The biofuel mandate implementation will support palm oil prices and enable planters, especially the smallholders, to reap economic benefits," said Dompok. Eventually, the mandate will be extended to other states and take up half 0.5m tonnes of the country's total annual crude palm oil production. No time-frame was given. (Reuters)

Despite several challenges especially the high cost of producing bio-fuel, the Sime Darby is walking its talk and taking the lead in showing Malaysians that biodiesel will be fuel of the future. The group had its fleet of diesel engine cars and four-by-four vehicles, used by its senior managers and staff, filled with Bio-N, the palm based biofuel produced by the group.

• In what was considered a symbolic launch in the usage of biofuel, the group had Minister of Plantation Industries and Commodities Tan Sri Bernard Dompok filling up the vehicles with the biofuel at its biodiesel plant in Carey Island here. 
• It was to take the lead in using biofuel and also reflect their commitment to the usage of enviromental friendly fuel, said Sime Darby Plantation's MD, Datuk Azhar Abdul Hamid. (Bernama)

Bank Negara Malaysia (BNM) is in the final stage of assessing applications for up to nine new banking and insurance licences, and expects to conclude the process by April. "Sometime in May or early June, the announcement would be made," Governor Tan Sri Dr Zeti Akhtar Aziz said.

• She said the applicants were institutions from Europe, the Middle East and Asia. On the insurance sector, she said, it should consolidate in order to have a more significant role in the local financial system and economy. (Bernama)

RHB Investment Management (RHBIM) has bagged the most innovative product in Malaysia at the Asia Asset Management 2009 Best of the Best Awards in Hong Kong recently. The winning fund, the RHB China Averaging Capital Protected Fund, which was launched in Mar-09, is a 100% capital protected fund in ringgit. The fund is a unique capital protected fund that accumulates investments during the first 12 months and then participates in the growth of China over the next 24 months. (BT)

Telekom Malaysia (TM) has unveiled "UniFi", the new brand for its next-generation high speed broadband service. TM's UniFi high speed broadband packages comprise triple-play services of high speed Internet, video (IPTV), and phone, with speeds of 5Mbps, 10Mbps and 20Mbps.

• The IPTV service which makes up part of the value-add bundled service will be delivered via an 8Mbps connection exclusively and in addition to the data speeds subscribed by the customers. With IPTV, customers can enjoy 22 linear channels, Video-On-Demand and interactive services such as games and tourism information. (Bernama)

Billet prices into Southeast Asia hit US$600 per tonne cfr as the market accepted offers that were described last week as "crazy". Billet bookings have risen to US$565-600 per tonne cfr, up from US$520-545 cfr last week, tracking the growth in international prices and scrap prices, said sources in Vietnam, Indonesia, Malaysia and Singapore.

• Volumes were thin and the highest deals were reported for Russian material at US$590- 600 cfr, sources said. Offers continued to push higher this week to US$585-635 cfr from Malaysia, Taiwan, Russia and Turkey. Billet offers to Vietnam were the highest in the region, touching US$605-635 cfr for material from Russia, Turkey, Taiwan and Malaysia. 
• In Malaysia and Singapore, offers for billet were slim; Malaysian mills increased their offers to US$585-600 per tonne fob this week, up from $550 fob last week. (Metal Bulletin)

SP Setia says its target of RM2bn sales this year will be driven mainly by projects on the home front. "About RM1.9m will come from Malaysia and the remaining RM100m from Vietnam," SP Setia president and CEO Tan Sri Liew Kee Sin said.

• Liew said that SP Setia's sales represent less than 5% of the total market and he hopes to increase this share by ensuring that the group maintains its sales growth of 20% a year. He foresees the Malaysian property market being resilient despite an expected normalisation of interest rates in the next one to two years. (BT)

Permaju Industries unit Cergazam Sdn Bhd has been appointed by the Naza Group as an authorised Chevrolet retailer for 3S (sales, service and spare parts) operations at four locations in the country. Permaju said it had signed a short-term agreement with Naza's unit Pavillion Crest Sdn Bhd. The four locations are namely in Petaling Jaya, Bukit Mertajam, Penang and Johor Bahru.

• Naza is the new sole and exclusive authorised distributor for Chevrolet cars here, after it signed a distributor sales and service agreement with General Motors Co (GM), which had parted ways with its original partner DRB Hicom. It has been reported that Naza plans to increase the dealership network to 18 by the end of this year from the current eight, including five Naza-owned dealerships. (The Edge Daily)

Petronas has strongly denied reports that it has made a big discovery of an oil field which is said to be one of the biggest in the world. “We adopt a well-established reporting process whereby we make progress report to the board and stake holders as well as to the Government. There is no way we are hiding any information with regards to the discovery as we have no intention to hide any news,” exploration and production business vicepresident Ramlan A Malek told a media briefing yesterday. Former Petronas chairman Tengku Razaleigh Hamzah had reportedly claimed that Petronas had discovered a huge tract of oil reserve that could significantly reduce oil prices. (Star)

Firefly is proposing to increase its flight frequency to twice daily for the Ipoh-Singapore from one daily flight currently. MD Datuk Eddie Leong said the proposal was based on the high demand for the route which records a 90% take-up each flight. Firefly was also scheduled to receive three more ATR72-500 aircraft costing US$18m each at the end of this year and this will further support the company's plan to expand its network and increase passenger number. (Bernama)

The initial public offering (IPO) of Oversea Enterprise, owner of “Restoran Oversea”, has received a good response, with its public tranche of 12m shares oversubscribed by 10.3x. Oversea said it received 4,186 applications for 135.4m shares with a total value of RM31.1m, for the public tranche of 12m shares. Oversea is slated for listing on the ACE Market on 1 Apr. (BT, Bernama)

AEON Credit Service has appointed Yasuhiro Kasai, 38, as its new MD from 20 Apr 10. He replaces Naruhito Kuroda, who will assume a new role in Tokyo, Japan. Kasai is currently the head of operating management division of the company. (BT)