Monday, May 31, 2010

20100531 1048 Malaysia Corporate News.

The ban on sale of cigarette packs of less than 20 sticks per pack will take effect from Jan 1 next year. Deputy Director-General of Health (Public Health) Datuk Dr Hasan Abdul Rahman said the provision for the ban had been gazetted on Sept 23, 2004 through the Control of Tobacco Products Regulations 2004. “It is hoped that with this notification, tobacco manufacturers will have sufficient time to make changes,” he said. (Bernama)

It could be a a start of a consolidation of the oil & gas sector given the local and regional jobs that are coming onstream over the next few years and the rise in M&A activities in the past six months. The business area that is expected to be most active in the upturn of the sector is fabrication. Also, the listing of Malaysia Marine and Heavy Engineering S/B could be a re-rating catalyst for the sector. (Edge Weekly)

Sime Darby has been dethroned as the largest company on the FTSE Bursa Malaysia KL Composite Index (FBM KLCI) and now occupies third place after having shed close to RM5.89bn in market capitalisation over the last one month. Instead, Malayan Banking (Maybank) now reigns as the largest company on Bursa Malaysia with a market cap of RM50.54bn as at May 27. Second spot is held by CIMB Group Holdings Bhd with a market cap of RM47.89bn. (Starbiz)

The new acting president and chief executive officer of government-linked conglomerate Sime Darby was questioned by the Malaysian Anti-Corruption Commission (MACC) as part of its probe into the recent massive losses incurred by the company. The MACC lodged a report and started investigating the case following a revelation on May 13 by the company that it had incurred losses amounting to RM964m.
  • Azhar said that the anti-graft body questioned him as part of its preliminary investigations. “I had a three-hour serious discussion with (the MACC). They asked general questions as (the probe) is still in the early stages. Sime Darby will give our fullest cooperation,” he said. (Starbiz)
Sime Darby has appointed a legal firm, believed to be Zaid Ibrahim & Co, to investigate if fraud had taken place at the conglomerate’s stricken energy and utilities (E&U) division.
  • “The board has appointed a legal firm to independently conduct follow-through investigations to determine culpability, based on the findings of the work group on the four key projects of the division,” it said. 
  • Sime Darby also said it had commissioned PricewaterhouseCoopers (PwC) to review the group and its reporting structure as well as to conduct forensic audits into the affected projects in conjunction with the legal review. (Starbiz)
A source close to Khazanah says the investment arm is not interested in a corporate brawl, but instead continues to see healthcare as a strategic business. Government investment arm Khazanah Nasional will not sell its stake in Singapore's healthcare group Parkway Holdings Ltd even if Indian shareholder Fortis Healthcare Ltd launches a counter offer, a source close to the company said.
  • On Saturday, India's The Economic Times said that Fortis was in discussion with the Government of Singapore Investment Corp Pte Ltd (GIC) over financing options as the former considers the possibility of launching a counter offer on Parkway. 
  • Quoting a source familiar with the situation, the publication said that Fortis is also in talks to buy Khazanah's shares in Parkway after Khazanah made a S$1.18bn (RM2.8bn) offer last Thursday to take control of the healthcare group. (BT)
Trade in palm oil products should not be victimised by legislation in the European Union (EU), and in Australia, arising from the Western anti-palm oil campaigns, said the Malaysian Palm Oil Council (MPOC) CEO Tan Sri Yusof Basiron.
  • Such legislation would be seen as a trade protection measure, which could force the affected countries to retaliate. Malaysia's above average performance in habitat conservation of the orang utan and in greenhouse gas emission (GHG), as well as being a net sequester of carbon, deserves recognition, he said. 
  • "We have earned our right to trade. We should not be asked to clean the mess (GHG emission) of developed countries," Yusof said. He cited the refusal of Russia, a world leader in timber production and export, to comply with the EU-certified timber scheme. Likewise, palm oil should not be singled out for sustainability compliance unless other competing oils are also subjected to similar requirements.
  • GHG emission is not an issue as Malaysia is a net carbon sink country with more than 82% tree cover provided by permanent forests and plantation crops, including oil palms, rubber, cocoa and coconuts. 
  • Yusof said the Western non-governmental organisations (NGOs) should focus on campaigning for the reduction of GHG emission in their own countries, for instance, closing polluting coal mines. 
  • "How is it that the UK produces 18m tonnes of coal per year and the NGOs do not seem to notice the GHG emitted but they can detect burning of a few hectares of forest for agricultural conversion in Indonesia 10,000 km away?"
  • He pointed out that 66m tonnes of carbon dioxide emitted a year from 18m tonnes of coal produced in the UK was equivalent to deforestation of 378,000ha of degraded rainforests. "This is more than double the yearly expansion of oil palm cultivation in Malaysia which in the past involved deforestation of degraded forest land zoned for agriculture." (BT)
European Union (EU) lawmakers are increasingly convinced that Malaysia is on the same path as the EU on the sustainability of palm oil production, but would need more scientific data to support Malaysia's case. Dan Jorgensen, who is the vice-chair of the environment, public health and food safety committee in the European Parliament, has promised to bring Malaysia's case on its discrimination versus other oils in the Renewable Energy Directive (RED). "We don't want any discrimination at all of the palm oil sector, and we promised the industry here to help have discussions with the EU on this," he said.
  • Jorgensen, who was in Malaysia last week with two other Members of the European Parliament (MEPs) Martin J. Callanan and Ole K. Christensen, were impressed with the work undertaken by the government and the palm oil industry and the sustainability efforts. 
  • "People there don't know how efficient an oil it (palm oil) is. I wasn't aware myself how much oil you can get per hectare compared with other oils - in that way it is iscriminated against," he added. According to the RED which will come into force in December this year, biofuels must have greenhouse gas savings of at least 35% and according to EU's calculation, the use of palm oil-based biodiesel failed the requirement as it achieved only 19%. (BT)
Penang has banned Berjaya Corp’s Ascot Sports to conduct any sports betting business in the state. CM Lim Guan Eng said “I believe Penang is the first state to apply this ban state-wide.” Lim added the decision did not mean that the state was against betting or gaming outlets but it was concerned over the excessive number of draws and special draws being conducted by the licensed operators.
  • Meanwhile, the Selangor government will also not allow premises in the state to be used for football betting, MB Tan Sri Abdul Khalid Ibrahim said. "Although the federal government had issued football betting licence, the state government, via local authorities has the power to stop it,” he said. 
  • Kelantan is likely to follow suit. (The Star)
Celcom Axiata foresees good growth in its enterprise segment with the signing of an MoU with SME Corporation Malaysia (SME Corp), which has about 40,000 SMEs registered, to promote a range of customised wireless products and services to its members.
  • "The enterprise segment alone contributes more than 10% to our revenue. We can grow it bigger as the machine-to-machine segment in Malaysia has yet to progress compared with other countries," Celcom Axiata CEO, Datuk Seri Shazalli Ramly said. (Bernama)
SK Telecom will invest US$100m in 25% of Packet One (P1) Networks, a unit of Green Packet, pending a final contract signing in June. After seeing little success in its earlier drive to directly enter the mobile business in the United States and China, SK Telecom is shifting focus to business-to-business network services and seeking alliances with Asian operators to tap corporate clients in the region. P1, which pioneered mobile WiMAX broadband service in Malaysia, had 175,000 subscribers as of end-March, according to SK. (Reuters)

Petra Energy will hold an EGM on 24 Jun to remove Tengku Datuk Ibrahim Petra, Lee Mee Jiong and Suhaimi Badrul Jamil as directors of the company. It is believed that the move is spearheaded by Petra Perdana's MD Shamsul Saad with the backing of Datuk Henry Kho and Francis Koh.
  • It is also believed that Shorefield Resources Sdn Bhd, which owns 30% of Petra Energy, is currently inclined to support the removal bid. Tengku said it is too early to say if he can muster enough shareholder support to defeat the resolution at the EGM. (BT)
Malaysia's latest issue of five-year global bonds advanced on their first day of trading after yesterday's sale attracted orders for more than five times the US$1bn (RM3.3bn) originally sought. "Malaysia is oil-rich, the fundamentals are solid and they don't have funding needs," Paul Chan, the Hong Kong-based CIO at Invesco Asia Ltd, said before the sale. "There will be scarcity value in Malaysia's dollar bonds. Asian countries are generally underrated" given what's happening in Europe”, he added.
  • Malaysia's sale of so-called sukuk notes, its first international debt issue since 2002, will set a new benchmark for pricing bonds in the nation, Prime Minister Datuk Seri Najib Razak said. (BT)
Promoting takaful via agency is fast gaining prominence with more players now investing significantly to beef up their agency channel and grab a larger slice of the competitive takaful market. This mode of distribution, according to an industry player, had become more significant in view of the “Takaful For All” approach adopted by newer takaful entrants whereby takaful could be sold or promoted by anyone regardless of faith and religious beliefs. The earlier operators were mainly using direct marketing to promote their products and services. (StarBiz)

Some 30km of beach near Teluk Ramunia are polluted with oil sludge following the collision between two ships in Singaporean waters last Tuesday. Fishermen said the sludge hit the beaches on Friday night. On Tuesday, MISC’s MT Bunga Kelana collided with bulk carrier MV Waily, causing about 2,500 tonnes of crude oil to spill from a gash on the double-hulled tanker's port side.
  • Efforts to contain the spill have been carried out, with crews using biogradable dispersants and absorbent materials to soak up the oil, while 3.3km of booms circled the main slick in the shipping lanes that straddle the waters of Singapore, Malaysia and Indonesia. It is understood that the fishermen have not been going out to sea since the oil spill began. (NST)
CSC Steel Holdings hopes to maintain its full-year pre-tax profit at some RM100m compared with last year's RM116.6m, says outgoing MD Su Wei Jin. CSC Steel Holdings Bhd, the country's largest producer of cold rolled steel by volume, expects to post higher profits and revenue for the first half of this year from a year ago, driven by stable domestic demand, a continuing recovery in steel prices from 2008 lows and cost cuts.
  • "Our first half performance should be better (than the year-ago period). And as long as the market remains in the same mood, the second half of the year will still be good. Liang Shiu-Chang has since 1 May assumed the role of the company's group MD, replacing Su who has taken a larger role as assistance vice-president (commercial) of China Steel Corp, Taiwan's largest steelmaker. CSC Steel is a 45% owned by China Steel. (BT)

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