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Reports Malaysia

Malaysia stock market and companies daily report (May 30, 2014)

May 30, 2014, Friday, 06:20 GMT | 01:20 EST | 09:50 IST | 12:20 SGT
Contributed by Shares Investment

NCB Raises Capex By RM500m

- NCB Holdings is adding another RM500 million in capital expenditure (capex) this year after spending RM600 million in capacity expansion efforts at Northport since 2012.

- The additional spending will help boost its container handling capacity to 6.2 million twenty-foot equivalent units (TEUs) by 2016 from the current 5.6 million TEUs.

- NCB has an expansion programme comprising over RM1 billion worth of investments to push towards its targeted installed capacity. It has, for the first time, utilised short-term borrowings with internal funds for the capacity expansion works, adding that its gearing now stands at 25 percent.

Significance: Notably, Northport’s conventional cargo operation registered an 18.5 percent increase to 9.8 million freight weight tonnes in FY13 despite recording lower revenue. NCB’s upgrading efforts would likely be paid off in its bid to attract larger vessels as global trading would improve with the gradual recovery of global economy.

Felda To Privatise Encorp

- Felda Investment Corporation (FIC) has made a mandatory general offer of RM1.55 per share to take Encorp private. The takeover offer of Encorp is estimated to cost RM477.2 million.

- The offer was triggered by FIC’s conditional sale and purchase agreement on May 6 to buy 66.6 million and 43.7 million shares from Lavista and Pegang Impian Holdings respectively.

- Encorp reported that FIC has confirm their financial capability to ensure that the offer doesn’t fail and that FIC does not intend to maintain its listing status in the event FIC receives more that 75 percent acceptances.

Significance: The takeover is in line with FIC’s strategy to build its capabilities in property development and acquire investment properties and will be able to serve as a platform for FIC to undertake the development of its land bank in the longer term.

MD of Eastern & Oriental Buys Shares Of E&O At A Premium

- Eastern & Oriental’s (E&O) managing director (MD) Datuk Terry Tham Ka Hon, has reassured shareholders that he will be part and parcel of the company in the long haul, despite his term as MD comes under review in August.

- Datuk Terry has acquired 110 million shares at RM2.90 per share from Sime Darby, for a total cost of RM319 million.

- In 2011, Datuk Terry and two other major shareholders sold 30 percent of their stake to Sime Darby at RM2.30 per share when the market price as less than RM1.70, drawing criticism on several fronts.

Significance: Shares of E&O climbed 4.2 percent to close at RM2.48 yesterday when news broke out. Datuk Terry reportedly say that the company is attractive. Additionally, he mentioned that the core team at E&O comprised of 16 people who have been with him for many years and have contributed to the significant growth of the company.