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Reports Malaysia

Malaysia stock market and companies daily report (July 31, 2014)

July 31, 2014, Thursday, 07:58 GMT | 03:58 EST | 12:28 IST | 14:58 SGT
Contributed by Shares Investment

China Stationery Estimates Rmb333m In Fire Damage

- China Stationery (CSL) has disclosed an estimated loss of Rmb332.7 million arising from a fire that occurred at its plant in Fujian province, China, on 4 April, 2014.

- However, the losses may be mitigated by an estimated insurance claim of Rmb142.5 million.

- It is uncertain if the loss disclosed is the final damage for the stationery maker, whose operations are based in China.

Significance: As a result of the fire, CSL had to delay the fulfilment of the orders worth Rmb310.7 million and as of 30 July’s closing price, CSL’s share price has tumbled 57.5 percent to RM0.085.

Opcom To Buy 40% Stake In UK Supplier

- Opcom Holdings has proposed to acquire a 40 percent interest in Unigel (UK), a firm involved in lubricant pumping equipment, lubricants and consumables, for US$3.7 million (RM11.7 million).

- The proposed purchase would enable Opcom to hold a strategic stake in Unigel, which supplies a critical component – thixotropic gel, used in producing the former’s fibre optic cables.

- Unigel is Opcom’s sole source of thixotropic gel due to its track record and reliability of the gel.

Significance: The proposed acquisition is expected to contribute positively to Opcom’s future performance by securing a consistent supply of thixotropic gel to the firm as well as improve the production process and quality of fibre optic cables manufactured by the firm.

Scomi Energy Proposes RM141m Rights Issue

- Scomi Energy Services has proposed a renounceable rights issue of up to RM140.5 million five-year redeemable convertible bonds, expected to be completed by 1Q15.

- Of the proceeds, up to RM45 million will be used to repay its bridging loan that was incurred following its acquisition of a 30 percent stake in Ophir Production.

- Out of the balance, RM92 million will be channelled towards working capital for its existing oilfield and marine services operations and the development of the Ophir oilfield while RM3.5 million will be used to offset the rights issue expense.

Significance: Scomi Energy intends to procure an irrevocable written undertaking from Scomi Group, the majority shareholder of Scomi Energy with an equity interest of about 65.7 percent, to ensure Scomi Group’s share of proposed rights issue is fully subscribed.