Thursday, May 24, 2012

20120524 1107 Malaysia Corporate Related News.

Petronas Chemicals to spend RM2bn in capex this year
Petronas Chemicals Group will invest close to RM2bn in capex this year for its Sabah Ammonia-Urea (Samur) plant in Sipitang, Sabah, as well as for maintenance of its other plants. The company will also soon expand downstream capabilities at its Gebeng Integrated Petrochemical Complex together with its JV partner BASF SA, its chairman Datuk Wan Zulkiflee Wan Ariffin said. (Malaysian Reserve)

TSH to spend RM1bn capex in next 5 years
TSH Resources is looking to spend about RM1bn over the next 5 years to expand its business, which includes buying plantation land in Indonesia and Sabah. Its chairman Datuk Kelvin Tan Aik Pen said the company has the necessary planted areas and matured trees to generate increasing fresh fruit bunch (FFB) production and cash inflow to fund the expansion, hinting that it would likely not involve any borrowings. (Malaysian Reserve)

UOA Development sells building to DKLS for RM94m
UOA Development will dispose of a 14-storey office building to DKLS Industries for RM93.8m. It said its units, Nasib Unggul and Paramount Properties SB, entered into an agreement with DKLS Equity SB, DKLS’s subsidiary for the transaction. (Malaysian Reserves)

Star Publications appoints Tony Fernandes as a director
Star Publications (M) has appointed Tan Sri Tony Fernandes as an independent non-executive director, effective 23 May, according to the publisher. Fernandes succeeds Datuk Wira Syed Abdul Jaabar Syed Hassan, who did not seek re-appointment after the end of his 15-year tenure as a non-executive director. (Malaysian Reserve)

Thai AirAsia IPO set at RM0.37 per share
The offer price for Thai AirAsia’s IPO has been set at THB3.7 (RM0.37) a share, said its major shareholder Asia Aviation Pcl, as the Thai affiliate of AirAsia prepares for a listing at the end of this month. A total of 1.2bn shares would be offered to investors during the subscription period from 23 to 25 May for trading on the Stock Exchange of Thailand soon. (StarBiz)

Ramunia set to exit PN17 status
Ramunia Holdings will complete its financial regularization plan by end-July, said CEO Nor Badli Mohd Alias. After completing its regularization plan, the company intends to apply to Bursa Malaysia to lift its PN17 status. Yesterday also saw the departure of founder, Datuk Azizul Rahman Abdul Samad, from the company’s board, he said after the company AGM yesterday. (StarBiz)

MAS: No plans to revive Firefly jet ops. Malaysian Airline System Bhd (MAS) will not be reviving its subsidiary FlyFirefly Sdn Bhd's jet operations to Sabah and Sarawak anytime soon. MAS took over the jet services of former low-cost unit Firefly between the KL International Airport in Sepang and Sabah and Sarawak last December as part of its wider network rationalisation, leaving Firefly with an all-turboprop fleet. (Source: The Sun)

Federal Land Development Authority (Felda) has teamed up with fellow plantation giant Sime Darby Bhd to make industrial sugar from oil palm biomass. Felda Global Ventures Holdings Bhd president Datuk Sabri Ahmad said returns from the venture would be big if the total costs including logistics to convert the biomass is below US$100 (RM314) per tonne. Oil palm biomass is agriculture wastes such as tree trunks, empty fresh fruit bunches and fronds. Felda and Sime Darby have a formed a special purpose vehicle (SPV) with Malaysia Industry Government High Technology (Might) to undertake the venture. Sabri said the groups are doing a feasibility study. "The three parties are evaluating whether we can convert biomass into non-edible sugar. We are studying all aspects from logistics and systems in the field to transporting the biomass to a central collection centre and processing factory in Pasir Gudang, Johor."If all can be done under US$100 per tonne, then it is commercially viable and the returns are big," Sabri told BT in an interview yesterday. If feasible, MyBiomass will set up a plant that is expected to require 60,000 tonnes of feedstock a day to produce 1.2 million tonnes of sugar a day.(BT)

Khazanah Nasional said its commitment to Malaysia Airlines’ (MAS) recapitalisation exercise is contingent upon the national carrier’s performance. “We can put in the money but we also need to see results because this is public money that we are talking about. It cannot be a bailout.” Khazanah director Tan Sri Azman Mokhtar said. Azman also added, “We need to see results coming through; we need to see Malaysia Airlines’ union, management, board and all stakeholders to work together to advance the company.” The national carrier recently announced a RM9bn fund-raising exercise to pay for aircraft purchases and to finance its working capital. Among the plans is the issuance of up to RM2.5bn in Islamic bonds by June this year. MAS also had said that if its plans fall short, it would rely on parent company Khazanah Nasional to step in to provide financial support in the form of capital equity injections to finance any unfunded aircraft capital expenditure and also working capital needs. (Bernama)

Malaysia Airlines (MAS) has secured investors, mostly in the form of government-linked investment companies (GLICs) to take up the bonds it will be issuing. "Those that will subscribe to most of the bonds, especially the government guaranteed RM5.3bn bonds, are likely to be institutions such Malaysia Airlines (MAS) has secured investors, mostly in the form of government-linked investment companies (GLICs) to take up the bonds it will be issuing. "Those that will subscribe to most of the bonds, especially the government guaranteed RM5.3bn bonds, are likely to be institutions such Malaysia Airlines (MAS) has secured investors, mostly in the form of government-linked investment companies (GLICs) to take up the bonds it will be issuing. "Those that will subscribe to most of the bonds, especially the government guaranteed RM5.3bn bonds, are likely to be institutions such as KWAP, EPF, LTAT and PNB. Other takers may include unit trust and insurance companies," one banking source said. (StarBiz)

AirAsia Group CEO Tan Sri Tony Fernandes has joined the Board of Star Publications (Malaysia) Bhd as Independent Non-Executive Director. In a statement, Star Chairman Tan Sri Dr Fong Chan Onn said: "Fernandes is a farsighted entrepreneur who has built a global brand in AirAsia, and we hope to tap on his insights and exposure in the global stage to grow in Malaysia beyond." Fernandes replaces Datuk Wira Syed Abdul Jaabar Syed Hassan who did not seek re-appointment after serving nearly 15 years as Non-Executive Director. "It is an honour and I look forward to contributing in whatever way I can, as The Star seeks to expand from print to become a multi-channel media company," Fernandes said. (Bernama)

Multi-Purpose Holdings (MPHB) has proposed a demerger that will make it a dividend play with a sustainable payout policy of 80%. The exercise principally involves the separation of MPHB's gaming and non-gaming businesses, which will later be listed on the Main Market of Bursa Malaysia through a special purpose vehicle (SPV). MPHB managing director and major shareholder Datuk Surin Upatkoon said it is the group's vision to become a dividend yielding stock comparable to its rival NFO Berjaya Sports Toto (BToto) and mobile player DiGi.Com. Surin said MPHB will continue to divest some of its non-core assets, which include stockbroking firm AA Anthony. However, it will not dispose of its general insurance business under MPHB Insurans. (Financial Daily)

In a first-of-its-kind lawsuit, a state-sponsored cattle firm is suing Malaysia's third largest lender for reputational loss over an alleged security breach. The National Feedlot Corporation (NFC) issued a statement alleging that Public Bank had allowed the confidential banking information of the firm's chairman and related companies to be "exposed to the world at large". "The security breach by Public Bank had allowed Parti Keadilan Rakyat strategy director Rafizi Ramli to dramatise and sow the seeds of distortions and misrepresentations to defame and damage the reputation and credibility of NFC, its related companies and its chairman with the government and general public as well as with the business and financial communities," NFC said, alleging a breach of the Banking and Financial Institutions Act 1989. The opposition party was the first to blow the whistle on NFC after the Auditor-General in his report last year noted that the firm's accounts were "in a mess". Over the space of several months, Mr Rafizi had held press conferences to detail accounts of how and where the cattle firm had spent a RM250m (S$101.3m) loan that it had received from the government. (Singapore Business Times)

Maxis Bhd's latest fibre internet package is offering new customers high Internet speeds of 10Mbps at RM118 per month with free installation for a limited time only. The new package comes with a 24-month contract. Maxis said more value for money is in store as customers will also have access to unlimited download quotas, allocated free minutes to Maxis mobile numbers and selected IDD destinations, as well as unlimited calls to Maxis fixed lines. Customers will also enjoy free value-added services such as unlimited music downloads through Onemusic, Internet security, as well as free devices. Maxis postpaid customers will get extra 150 minutes on their Maxis mobile every month, at no extra cost. Existing Maxis Home Fibre Internet customers who have completed a minimum of 12 months on their contract are also eligible to migrate to the new package at no extra cost by renewing their contract for 24 months. The Maxis fibre Internet service is built on fibre-to-the-home (FTTH) technology and is available across 1.2m homes and offices in Klang Valley and selected areas in Penang, Johor Bahru, Ipoh and Malacca. (Business Times)

Axiata Group Bhd said there is no need for the company to make further impairment charges on Idea Cellular Ltd for now, even though its investment's market value has shrunk by about one-third. However, it does not discount the possibility of a further impairment in the future, depending on how the India telecommunications industry progresses. "For now, there's no need for further impairments, but we will continue to evaluate periodically. When we evaluate, it's not over a short-term basis, it's a long-term basis where we look at the whole prospect of the company and industry," said president and chief executive officer Datuk Seri Jamaludin Ibrahim after the company's annual general meeting yesterday. On how Axiata plan to utilise its cash pile, the company said it is expected to use part of the cash to reduce borrowings that are incurring higher interest rates, and will continue to be prudent on how it spends the money. (Business Times)

Green Packet Bhd aims to hit RM1bn in revenue by 2015, partly helped by the expansion of its wireless broadband business. "The growth potential in the wireless broadband is huge," said group managing director Puan Chan Cheong in an interview recently. The company - which saw red in its earnings before interest, tax, depreciation and amortisation (EBITDA) for the past four financial years - registered a "positive EBITDA" during the first quarter this year. For the first quarter ended March 31 2012, the company posted a net loss of RM29.74m, compared to RM37.89m net loss in the same quarter last year. Revenue rose by 5% to RM128.17m. The group recorded an EBITDA of RM3.9m for the quarter, a 153% jump yoy. Its P1 pillar contributed about 85% (or RM3.3m) to the group's total EBITDA . "We have invested a total of about RM1bn in capital expenditure. These investments would need to be amortised over a 10-year period. So, this means we are looking at depreciation of about RM100m a year," he said. The company is evaluating a few proposals from investment bankers on the possibility of listing P1 on the stock exchange. He added that the company, as well as P1, remained open to the possibility of merger or partnership with its rivals. "I think the industry is set for a consolidation. I think, eventually, there will be four to five players. We are currently the fourth largest broadband provider, after Telekom Malaysia Bhd, Maxis Bhd, Celcom (Axiata) Bhd," said Puan. (Business Times)

Tan Chong Motor Holdings (TCMB) is confident of recuperating from its first-quarter drop in net profit with the introduction of several models in the 2H of 2012, and positive boost of its quarterly financial results could be realised as early as end-May or early-June. According to Edaran Tan Chong Motor (ETCM) executive director Datuk Dr Ang Bon Beng and TCMH group financial controller Jacylyn Loy, this year's total sales volume, however, is not expected to reach the 2011 level. TCMH said the anticipation of the lower full-year revenue and net profit is in line with the Malaysian Automotive Association's projection of a 12.6% reduction in total industry volume (TIV) from the forecast of 615,000. (Malaysian Reserve)

The US$20bn Petronas’ RAPID project in Pengerang will potentially require 10 to 12 partners, said group COO Datuk Wan Zulkiflee Wan Ariffin. He added that Petronas prefers to finalise the choice of its partners in RAPID before the national oil & gas giant declares its final investment sanctioning, slated to take place in the middle of next year. The project, which was introduced in May 2011 and officially launched a year later, has so far secured the partnership of three corporations. (Star)

SP Setia is said to be one of the bidders that have ended up in an informal shortlist for the Battersea Power Station site in London. Besides SP Setia, a number of other Malaysian developers were among the international bidders for the redevelopment of the 15.8ha site. A good number of the bid "are quite strong" and a decision on the successful bidder is expected soon. (Starbiz)

After recently acquiring 21.3 acres in Tanjung Bungah for RM185.6m, SP Setia is now looking at an adjacent 14-acre site in Penang. "We expect to ink the deal soon. The two properties are an integral part of the group's business plan to launch about RM2.5bn worth of properties on the island this year and 2013," said Datuk S. Rajoo, divisional general manager of SP Setia. SP Setia's plans for Penang include the launch of residential and commercial properties worth over RM638m in the second half of 2012. In 2013, besides the RM1.1bn project in Tanjung Bungah, SP Setia will also launch a RM175m condominium project in Sungai Nibong, and the Wave and Breeze condominium projects for Setia Pearl Island with a GDV of RM350m and RM300m respectively. (StarBiz)

CMS Cement Sdn Bhd, a subsidiary of Cahya Mata Sarawak Bhd (CMS) and the state's sole cement manufacturer, is embarking on an expansion programme with an initial investment of RM150m in its effort to meet the growing demand for the material. "We are still doing the actual costing but when the programme is done, we are optimistic of coping with the increasing demand from the state and particularly from construction activities in its regional development corridor which is the Sarawak Corridor of Renewable Energy (Score). "The state's annual need is 1.66m tonnes and in the last five years, it has registered increases of 10-15%," CMS Group managing director Datuk Richard Curtis told reporters after declaring open the company's RM22m Sibu Bulk Cement Terminal at Upper Lanang Road here yesterday.(BT)

British American Tobacco (BAT) appears to have bucked the trend as the only tobacco company in the country to have increased its market share last year amid an environment fraught with challenges. Its managing director William Toh attributes this to a robust strategy that was put in place two years ago - its strong portfolio of brands and business processes. On the outlook for the current year, Toh said BAT was well positioned to sustain its market share growth momentum although it anticipates challenges such as unlawful activities of certain local brands selling at below the government mandated minimum cigarette price and increasing operating cost pressure. (Malaysian Reserve)

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