Sources said that a commercial study by Land Public Transport Commission (SPAD) on the viability of the proposed high speed rail (HSR) project connecting KL and Singapore has found that it may cost RM30bn. The feasibility study will be completed this month, followed by a technical study. SPAD aims to complete the entire feasibility study by year end or 1Q2013. The HSR will have two services. First is an express service linking KL to JB and Singapore. Secondly, a service that transits at KLIA, Seremban, Muar, Melaka and Batu Pahat before stopping at JB. The project is expected to 1.5 years to design and 3-4 years to complete. Target is to launch the project in 2018. To make the project viable, the HSR needs 8m passengers p.a. (Edge Weekly)
The power assets of T. Ananda Krishnan have been sold to 1Malaysia Development Bhd (1MDB) – the biggest asset sale in the country and probably the region. Sources say the deal was closed last Friday with the assets being sold for US$3.2-3.6bn (RM9.9-11.2bn). (Star Biz)
Volkswagen (VW) AG, Europe’s biggest carmaker, has identified its VW Polo marque as the best fit for Proton Holdings Bhd. BT understands that VW has formed a special team headed by Soh Wei Ming, its operations head for Asia Pacific, to look into the possibility of remodelling the Polo as the national car.
VW has done this successfully before when it turned around the Czech Republic’s then loss-making Skoda Auto in the early 1990s. Today, Skoda, which mainly sells compact cars, is a profitable entity with plants in Europe and Asia. Skoda is selling some 879,200 units globally. The Polo currently costs above RM100,000 but the plan put forward by VW to Proton’s ultimate owner, DRB-Hicom Bhd, would see Polo, produced locally with German technology, priced competitively at below the RM70,000 mark. Since DRB-Hicom's emergence in Proton, some of VW’s top group directors have visited the Proton plant, as well as reviewed all the existing Proton models.Following the review and a meeting in Hong Kong last month between Soh and DRB-HICOM’s chief operating officer, Datuk Lukman Ibrahim, it was decided that the Polo would be the best fit for Proton. VW and DRB-Hicom is assemblingthe 1.8-litre engine Passat sedan at its plant in Pekan, Pahang. The launch of the locally assembled models is expected to take place this month. VW has been scouting Asia for a base to build a small turbo-based compact car ever since its 2009 partnership with Suzuki Motor Corp, Japan’s number one minicar producer, failed to complete any joint projects. (BT)
The government has started gazetting land stretching from Banting in Selangor to Taiping in Perak but landowners along the proposed RM7.1bn West Coast Expressway project are largely believed to be unaware of the move. The project will be undertaken by Europlus's 64%-owned subsidiary, West Coast Expressway Sdn Bhd and will be backed by a government support loan of RM2.24bn. (Malaysian Reserve)
Carlsberg Brewery Malaysia Bhd and Guinness Anchor Bhd (GAB) are taking divergent routes to seek further value growth for their shareholders. Carlsberg will bank on its overseas operations, in particular the growth from Asean markets, to drive its profits as it aims to transform Kuala Lumpur into its manufacturing hub, while GAB intends to continue its streak on focusing on the local market. Meanwhile, Carlsberg, which is beginning to reap the fruit of the consolidation of its Carlsberg Singapore Pte Ltd as a wholly-owned subsidiary, sees future growth coming from outside of Malaysia instead of from within the country due to the local market being already “saturated”. “Next year we expect that Singapore will grow twice as fast as Malaysia, and Malaysia will see single-digit growth. Market growth this year will only be a couple of percent (while) Singapore will grow around 6%,” Carlsberg Managing Director Soren Ravn says. On this note, Carlsberg intends to eventually transform Kuala Lumpur as its regional manufacturing hub to cater for all of the Asian region. “Asia is quickly becoming a global leader and the Asean region holds significant potential due to burgeoning economic prosperity. Focus is on Asia and how it can contribute towards global growth, on this score, we are strategically increasing the number of brands to be manufactured in Malaysia,” Ravn said. “To produce here is a lot more profitable. We are looking to be a regional hub but we will take this step by step. We will start with Singapore, which is under me now,” Ravn said. “Last year, we produced almost 1.4m hectolitres and we can still expand on that and we still have some exports that we can manage without having any capacity issues to supply to the domestic market in the next five years,” Raven adds. GAB's managing director Charles Ireland says the company will continue to focus on the Malaysian market and is confident of it because of growing wealth which will eventually translate into higher disposable income for the populace. “We will keep aiming to grow at our past five years' compounded annual growth rate of 11.5%. Some say that the market is saturated but we still see it otherwise and we can prove it with our track record in the past 10 years,” Ireland says, adding that GAB continues to see the Malaysian market as its future due to the potential upside growth from very low levels of per capita consumption of beer. GAB also sees the domestic market recording a mid single-digit volume growth for the next five years and expects sufficient capacity to meet demand. (Starbiz)
India, the world’s biggest palm oil buyer, should more than double the tax on imports to guard domestic refiners from cheap supplies, a processors’ group said. Duty on imports of refined palm oil should be increased to 16.5% from 7.5%, the Solvent Exractors’ Association of India said. India should raise the benchmark price for calculating tax on refined palm oil to US$1,200 a ton from US$484 and ban imports of edible oil in consumer packs, the association said. (Bloomberg)
Palm oil imports by Pakistan, the third-largest buyer, may plunge 22 percent this quarter after a transporters’ strike closed factories, a refiners’ group said. Shipments may decline to about 343,000 metric tons in the three months ending March 31 from 442,000 tons a year earlier, Abdul Rasheed Janmohammad, vice chairman of the Pakistan Edible Oil Refiners Association, said. Imports may rebound to the normal level of 150,000 tons to 175,000 tons a month from April, he said. (Bloomberg)
Top palm oil producer Indonesia's growing refining advantage will dominate an annual gathering of world's palm oil business in Kuala Lumpur next week as traders examine shifts in demand. Planters, refiners and bankers gather for the Bursa Malaysia Palm Oil Conference from Monday to Wednesday as the market for the tropical oil grows this year at the expense of soy oil, with the South American sou crop damaged by draught. (StarBiz)
IOI Properties will be kept extremely busy over the next two years as its revenue looks set to top the RM1bn mark again for its financial year 2013. “We are actually very optimistic. Based on our planned launches, both for residential and commercial, you will see that we are pretty confident of the demand we are likely to garner. The trend we see now is that there are a lot of parents buying houses for their children,” says IOI Properties Bhd senior general manager Lee Yoke Har. (StarBiz)
Malaysia's No.3 palm oil firm KL Kepong will build three refineries in Indonesia to tap higher margins after Jakarta lowered its processed edible oil export taxes, a senior company official said. (StarBiz)
Felda D'Saji is optimistic about achieving 10% growth in revenue for this year, compared with RM50m last year. It has been achieving strong growth in recent years as revenue in 2010 was RM40m, said Felda director-general Datuk Dzulkifli Abd Wahab at the launch of D'Saji Kitchen. Felda D’Saji started as a catering organisation and is fully owned by the Federal Land Development Authority (Felda) & Koperasi Permodalan Felda Bhd. (Bernama)
SP Setia Bhd sees southern Johor as the company's fixed deposit in view of the development and progress taking place in Iskandar Malaysia. President and chief executive officer Tan Sri Liew Kee Sin said the company would continue looking for more land in Iskandar Malaysia and outside Johor Baru, adding that there were still large tracts of land available in Johor for township. (StarBiz)
UEM Land expects to achieve higher sales of RM3bn in 2012 despite stringent loan guidelines, driven by existing projects and new launches as well as unbilled sales of RM1.85bn, said its CEO Datuk Wan Abdullah Wan Ibrahim. UEM Land plans to launch new projects with GDV of RM4.5bn this year, including RM1.7bn in Nusajaya. (The Sun)
Boustead Heavy Industries (BHIC) chairman Tan Sri Lodin Wok Kamaruddin has again denied recent news reports that the company will be taken private. Lodin, who is also LTAT chief executive and Boustead Holdings group MD, said LTAT has no intention whatsoever to take BHIC private. (Bernama)
Dijaya Corp Bhd’s majority shareholder, Danny Tan Chee Sing is injecting his personal assets into flagship property company, Dijaya, to enlarge the size of the company and unlock further value for shareholders, said sources close to the company. These personal assets are currently privately held by Tan and consists of land-banks nationwide as well as investment properties. While the size of the assets are not known, sources said the injection of the assets would result in Dijaya’s market capitalisation increasing from RM766.4m to about RM1bn. Sources said: “The intention is to create a bigger company and grow more aggressively, moving forward. The investment properties will also provide some form of recurring income for the company.” The acquisition was likely to be satisfied by a combination of cash and a corporate exercise, the sources added. (Starbiz)
Datuk Robin Tan Yeong Ching, CEO and interim chairman for Berjaya Corp Bhd (BCorp) is confident that the board of BCorp will continue to drive the group forward by expanding its existing businesses. "We will not consolidate but simply expand all the group's existing businesses. We will retain my father's (Tan Sri Vincent Tan) legacy... his entrepreneurial spirit and drive," Tan said. Speaking to BT, he said, "My dad's plan to step down from BCorp board was not really a surprise as he will have to do it one day. The surprise is the early timing. I have been running BCorp as a CEO for the past one year, so there will be no major changes but internally, we are setting up certain policies for everyone within the group." Tan, 37, has been involved in various aspects of businesses within the group for the past 17 years. He has been a board member for many listed entities under Berjaya Group for 14 years.(BT)
Print media will continue to be an important medium as long as it is able to provide relevant news, said Star Publications (M) Bhd executive deputy chairman Datuk Vincent Lee. “If you look at The Star (newspaper), it's a 40-year-old mainstream medium, but if you check last year's advertising expenditure (adex), the bulk of it went to print,” he said. Adex rose 12% to RM10.8bn in 2011, with newspapers retaining the lion's share at 40.5%. “Print has been the mainstream news for decades but consumers are still willing to pay for (printed) news content,” Lee said, adding that print would continue to be relevant to the consumer as long as it provided quality news.“It's about creative storytelling. There are 8.1m English literate Malaysians, (so) the market is still there and we can still grow side by side with the digital medium,” he said. Lee, however, said newspaper companies needed to evolve to stay competitive. “We need to be brave and transform ourselves constantly.” Meanwhile, OMD and PHD managing director Andreas Vogiatzakis in his presentation, “Will Print Media Survive in the Digital Era?” said that consumers still placed high value on the insight and analysis provided by newspapers. Citing renowned newspaper designer Jacek Utko, he also said newspapers should leverage on its headlines, text and photos to pull in readers. “Non-linear, bite-sized chunks of information are better digested. “Produce less news and more knowledge and make the reader smarter!” (Starbiz)
Envair Holding Bhd has proposed a private placement of up to 35.5m new shares, representing 30% of its issued and paid-up capital. The exercise is part of the firm's plan to venture into the distribution and trading of oil and gas products. The shares will be placed out to major shareholder Deepak Jaikishan, Envair directors Mohd Anuar Mohd Hanadzlah and Mohd Shukri Abdullah, as well as an independent investor to be identified at a later date. Based on the indicative issue price of RM0.275 per placement share, the exercise will raise a gross proceed of up to RM9.8m. (BT)
Reclusive tycoon Tan Sri A.P. Arumugam has increased his shareholding in Hibiscus Petroleum Bhd from 6.4% to 8.8% via an off-market deal, said sources. On Wednesday, 4m shares were transacted at an average price of RM1.78, while on Friday, another 6m shares were crossed at the same price. The stock closed on Friday at RM1.80 on volume of 2.7m shares. Arumugam first emerged in the company last July when his son Roushan Arumugam was announced to have bought 23m shares or a 5.5% stake in the company. Back then, he made the indirect purchase via Littleton Holdings Pte Ltd, of which he owns 90%. While no price was disclosed, it was believed that Littleton took up part of the placement of Hibiscus' initial public offering shares at RM0.75. Arumugam is the chairman and founder of Sri Inderajaya, which has significant investments in six major industries globally and consisting of agriculture technologies, consumer products, education, industrial technologies, property, telecommunications and travel and tourism. (Starbiz)
ACE Market-listed eBworx Bhd has received a potential takeover offer from Hitachi Ltd, at an indicative RM0.90 per share. That means a complete takeover of eBworx could cost Hitachi RM184.2m. Hitachi or its affiliate may propose to make a conditional voluntary general offer to eBworx shareholders, with a minimum level of acceptances of 85%. eBworx said the proposed offer was subject to conditions including completion of due diligence by Hitachi and the retention of certain key personnel.The board of eBworx has agreed for Hitachi to proceed with the due diligence. The latter is expected to make an offer in April. The eBworx group is a regional financial solutions specialist that provides digital commerce solutions to the financial services industry. It provides solutions for credit management, delivery channel (cash management, Internet banking and branch delivery) and trade finance. Its main revenue stream comes from systems maintenance and enhancement services. StarBizWeek recently reported that eBworx was targeting to secure contracts valued at about RM80m. “We brought over RM70m worth of jobs from last year that would only be translated into revenue this year,” said group CEO Tan Suan Fong recently.(Starbiz)
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