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Reports Malaysia

Malaysia stock market and companies daily report (September 03, 2014)

September 3, 2014, Wednesday, 05:35 GMT | 00:35 EST | 09:05 IST | 11:35 SGT
Contributed by Shares Investment

Berjaya Land To Sell 70% Stake In China unit

- Berjaya Land’s wholly-owned subsidiary, Berjaya Leisure (Cayman), together with Berjaya Times Square (Cayman), has signed a memorandum of understanding (MOU) with Carnival Group to dispose a total 70 percent interest in Berjaya (China) Great Mall Co (GMOC).

- GMOC is building the world’s largest shopping mall in the Hebei province.

- The price for the proposed disposal has yet to be negotiated but GMOC currently has a registered and fully paid-up capital of US$185.5 million.

Significance: Sources have suggested that the proposed disposal is a way to raise cash to build the Great Mall of China, which was initially slated for completion in 2017, but has fallen behind schedule.

Brahim’s Expected To Be Affected By MAS Restructuring

- Brahim’s Holdings is expected to be affected once Malaysian Airline System (MAS) migrates its operations to its new company (Newco) by July next year.

- As MAS migrates its business to Newco, the firm is expected to renegotiate its supply contracts with Brahim’s.

- As MAS contributes to almost 75 percent of Brahim’s sales, the move would hurt the latter’s sales volumes.

Significance: AllianceDBS Research mentioned that Brahim’s is unlikely to be able to secure new contracts from other airlines to fill the void left by MAS, particularly not in the near term.

Euro Holdings To Be Taken Over By Executive Director And 2 Shareholders

- Euro Holdings received a takeover offer from its executive director, Datuk Tong Yun Mong, and two major shareholders, Datuk Seri Choong Yuen Kheong and Tee Wee Sien, for the remaining 52.3 percent of the company that they do not own for a cash consideration of RM0.44 a share.

- However, the offerors have stated their intention to keep the listing status of the company.

- Euro Holdings is involved in the manufacturing, marketing and trading of office furniture.

Significance: Given that Euro’s share price closed at RM0.545 on 2 September, the offer is considered unattractive as RM0.44 represents a 19.3 percent discount.