Reports » Malaysia

Malaysia stock market and companies daily report (January 10, 2013)

Contributed by Shares Investment

UEM Land Edge Up On Land Disposal
UEM Land Holdings shares climbed in the early session of trading yesterday following its proposed disposal of two parcels of land in Commercial North, Puteri Harbour, Johor. UEM shares gained two sen to RM2.16 after hovering between RM2.17 and RM2.11 at midday yesterday. UEM has disposed the land (CN1 and CN2) which have a combined land area of 43,639 acres to Liberty Bridge for RM211.2 million and RM189.6 million, respectively. According to HwangDBS Vickers Research, UEM would likely book a one-off gain on disposal of RM241 million and boost its FY13 earnings by 57 percent, as the deal is expected to be completed by December this year. Meantime, Hong Leong Investment Bank believes that Puteri Harbour would be the heart of the bulk of land disposals in Nusajaya. “We believe it is part of UEM Land’s plans to rope in desirable partners to help develop the future skyline of Puteri Harbour,” it added.
Significance: UEM is currently planning to develop a significant portion of land within the Puteri Harbour, centred around the Commercial South and Private Marina precincts. The proposed disposal would allow the company to focus its resources in developing its remaining land in Nusajaya.

IOI Corp Unit To Increase Stake In HK Company
IOI Corporation’s (IOI Corp) indirect 99.8 percent owned unit Palmy Max acquired the remaining 50 percent stake held by Teijan Management in a jointly controlled entity, Prime Joy Investments for US$9.3 million or RM28.3 million. Through the completion of acquisition, Prime Joy will fully settle its shareholders’ advances owned to Teijan Management amounting to US$30.2 million or RM91.9 million. The share consideration of RM28.3 million was arrived at a negotiated basis based on a willing buyer-willing seller basis, based on the sole asset of the company which is 7.7 acres of land located in Xiamen, China. Prime Joy is a 50 percent owned joint venture entity by Teijan Management aimed at developing residential and commercial properties in Ji Mei District, Xiamen; China. Following the acquisition, Prime Joy will become an indirect 99.8 percent owned subsidiary of IOI Corp.
Significance: Upon the acquisition, IOI Corp will have better control and management of its operations in Xiamen. It also allows the group to facilitate a more timely and efficient decision-making process.

DRB-HICOM Plans “Asian Car” Project
DRB-HICOM is currently drawing up plans for an ambitious project, known as “Asian Car” which will transform Malaysia into a hub for the production of Volkswagen (VW) vehicles. The crucial part of the plan also involves its owner, Tan Sri Syed Mokhtar Al Bukhary needing to list the distribution arm of DRB-HICOM. The plan is to list the merged Proton Edar and EON, which are distributors of Proton cars. As part of the plan, DRB-HICOM itself might be delisted. “It is one of the options on the table,” based on a source familiar with the proposed plan. Under this option, DRB-HICOM’s automotive manufacturing arm and defence unit will be held privately by the tycoon via one of his companies. The automotive manufacturing arm on the other hand will be relisted consequently in another form, under the DRB-VW joint-venture.
Significance: Based on the source, shareholders of DRB-HICOM will be able to convert some of their shares into the new listed company. They will also be given some cash, between 50 sen and RM1.00 per share.