News Highlights - UMW Holdings, Glomac, Automotive Sector

UMW Holdings Bhd (RM7.30/share)

To decide on WSP’s future soon

UMW Holdings Bhd president and group chief executive officer Datuk Syed Hisham Syed Wazir said the decision on whether to take its 22.3% associate WSP Holdings Ltd private could be known by as early as this month. To recap, in December last year, private equity H.D.S. Investments LLC (HDS) had proposed to acquire WSP at US$0.60 (RM1.80) per share with the intention of taking it private. HDS has created a special purpose vehicle (SPV) and is offering cash to WSP’s minorities. Syed Hisham said WSP had then formed a special committee to deliberate on the offer.

WSP’s major shareholder Expert Master Holdings Ltd - wholly owned by WSP’s chairman and chief executive officer - with whom HDS has been in talks, will in turn be issued with shares in the SPV in exchange for its 50.9% stake.

WSP is being affected by anti-dumping and countervailing duties imposed by the United States on oil country tubular goods (OCTG) produced in China. This has forced UMW to make a provision for impairment losses, which was among the factors that led to the group’s oil and gas division to suffer a RM191.0mil pre-tax loss in the financial year ended December 31, 2011.– Business Times

Glomac Bhd (RM0.835/share)

Still on lookout for land banks in Greater KL

Glomac Bhd, which recently acquired two parcels of land in Klang for RM44.0mil, is still on the lookout for good land banks in the Greater Kuala Lumpur area. Glomac senior manager for group corporate communications, Fara Eliza FD Mansor, said the company is always scouting for good areas as its focus is very much on the Greater Kuala Lumpur area. She added that the company recently announced the acquisition of two parcels of leasehold land totalling 80ha, adjacent to Bandar Saujana Utama. The new land will allow Glomac to capitalise on the success of its flagship township and raise the company’s total estimated gross development value (GDV) of current and future projects to RM6.0bil. Currently, Glomac has a total of 11 ongoing projects, comprising a range of mixeddevelopments in Greater KL and in Johor Baru. She added that they are looking into expanding into Iskandar but it is yet undecided. – Business Times

Automotive Sector

Sales of premium cars speed up

Positive consumer sentiment, strong purchasing power and minimal impact from Bank Negara’s newly implemented responsible lending guidelines collectively helped boost sales of premium vehicles in February. Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad pointed out that Bank Negara’s new lending guidelines, which came into effect on Jan 1, had little to no impact on buyers of premium vehicles. Under the central bank’s new lending guidelines, loans are now approved based on net income compared with gross income previously, in addition to which is the need for more documentation. Aishah said the impact was more profound on the lower capacity passenger car segment. - StarBiz

Source: AmeSecurities