IJM Corp/Scomi
A shareholder battle brewing at troubled engineering concern Scomi Bhd is threatening to undermine a corporate rescue plan spearheaded by IJM Corp Bhd.
Businessmen Datuk Philip Siew Mun Chuang, who had acquired 5.61% in Scomi Bhd is claining that the proposed deal with IJM Corp and a separate plan to restructure the group’s oil and gas business are eroding the interest of minority shareholders.
In two different letters fired off to the Scomi group in mid Oct 2012, Siew is charging that the directors of the company are failing in their fiduciary duties and he wants them to significantly alter the group’s corporate restructuring plan. He is also threatening legal action gains the company if his demands are not met.
Maju Group’s Tan Sri Abu Sahid who has close business with Siew, had an 8.75% stake in Scomi and the collective 14.36% stake held by the two businessmen could prove crucial in a shareholder vote on any major corporate revamp in the group.
Scomi’s difficulty in meeting the debt obligations of over rm140 million in Sept 2012 forced its controlling shareholder and CEO to hammer out a deal with IJM Corp. Under the plan acquired a 9.06% stake in Scomi and separately acquired another rm110 million worth of redeemable convertible bonds that will ultimately raise its holding in the group to 25%. The bonds are convertible at 36 sen oer Scomi share.
Siew is claiming that the deal with IJM Corp will result in a 25% interest dilutive effect on all shareholders of Scomi Group. The deal is not equitable to all of Scomi’s shareholders because the company’s shares are trading at close to 20% (mid Oct 2012) over the proposed convertible price.
In the event Scomi fail to take immediate and effective steps to remedy the situation, Siew will be forced to take proceedings in court to enforce protection of his own and minority shareholders rights in the company, including the removal and replacement of the current (Oct 2012) board and those in the management of the company.
Another issued raised by Siew is the alleged plan by Scomi Group to transfer to associate concern Scomi Marine Bhd the rights to a contractor for oil exploration in a marginal oil field with Petronas and Australia’s Cue Energy Res Ltd.
Gamuda
What’s Up? … dated Oct 2012
The market is pricing in election risk. The flow of contracts could be affected if the opposition coalition wins the election. The opposition has also indicated that it wants to review the mega projects, which could have an impact on projects Gamuda has already secured.
Another concerns about Gamuda’s property arm, which is expected to see a slowdown, particularly in Vietnam.
In 50:50 JV with MMC Corp, Gamuda has secured the lion’s share ofKlang Valley’s MRT construction and engineering works, including the rm8.2 billion contract to construct a 9.5km underground tunnel and seven underground stations.
The MMC-Gamuda JV is the project development partner for the MRT project.
This brings Gamuda’s order book to over rm4.8 billion/ The stock may rebound when the political risks subside and there is more news flow on infra projects.
Another potential catalyst for the construction industry is the proposed second MRT line. A firm decision on it is expected to be made over the next two to three quarter from Oct 2012.
Meanwhile speculation that major shareholders and directors of Gamuda reducing their stakes in Gamuda. Market observers said that it could be a usual portfolio reorganization in anticipation of Malaysia’s impending general election.
Major shareholders and directors of Gamuda had disposed of Gamuda in early Oct 2012. The EPF had sold 4.5 million shares. Following the sale the EPF still holds 5.37% stake in Gamuda.
Meanwhile Raja Datuk Seri Eleena Azlan Shah, a director in Gamuda, had sold a total of 1.9 million shares in the open market at between rm3.52 and rm3.57 each. Followinf the sale, Eleena still owns an indirect 6.2% and a direct 0.01% stake in Gamuda.
Another director, Datuk Ng had disposed three million shares at rm3.50 each leaving him with a remaining direct stake of 1.39% in Gamuda.
IJM Corp/KEuro
The signing of the concession agreement for the West Coast Expressway is "on the horizon" and should not take much longer.
Kulim
Expectations that the company will pay put a windfall dividend from the proceeds of its sales of QSR Brands and KFC Holdings Bhd.
It is expected to receive rm1.16 billion in proceeds from the proposed disposal, which translates to 82 sen per share.
To recap, Massive Equity Sdn Bhd proposed to buy KFC Holdings and QSR for up to rm5.4 billion as part of Johor Corp’s consolidation plan in Dec 2011. Kulim holds a 56.8% stake in QSR, which in turn holds 51% equity stake in KFC.
JCorp will receive rm642 million from the dividend windfall as it holds a 55.35% stake in Kulim.
Kulim has 46000ha of plantation land in Malaysia, which are mostly planted. It will add another 1600ha by end 2012 after completing an asset acquisition exercise with JCorp. Indirectly through its 49.5% owned associate company New Britain Palm Oil Ltd, it will have another 130000ha in Papua New Guineaand the Solomon Islands. All in it is in control of close to 180000ha of plantation land.
60% of its trees are still at the young and prime mature stage. Kulim intends to expand the plantation operation and is constantly looking for opportunities.
Post disposal, expect its gearing to improve to 0.25 times.
About 76% of its plantation revenue was derived from New Britain.
After the disposal of KFC and QSR, Kulim’s contribution will come solely from plantations and ventures (shipping, ship repairs and biotech).
Kulim is one of the few planters to gain 100% RSPO certification for all its plantations. This is very important as in the future,Europe will only import palm oil products with RSPO certificates.
Hi bro, these news forwarded to u are for yr own 'consumption', need yr help pls do not post it publicly.
ReplyDeleteCK Kok.