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Wednesday, November 14, 2007

Leong not selling his stake in Mah Sing

PETALING JAYA: Mah Sing Group Bhd's single largest shareholder and managing director Datuk Leong Hoy Kum said he has no intention of divesting his 40.1% stake in the property company.

“I have not received any offer to acquire my stake in Mah Sing.

“I would like to clarify that I still want to maintain my shareholding in the company,” Leong told StarBiz yesterday when asked to comment on a media report that a consortium from the Middle East was keen to take a strategic stake in Mah Sing.

He said Mah Sing group had always welcomed strategic partners who could bring in new projects and more landbank for future developments to sustain its earnings growth.

It was “good news” for Mah Sing should there be parties interested in buying a stake in the company, he said, adding that such interest would speak well of Mah Sing's fundamentals and its solid track record, especially the company's quick project turnaround time.

“Investors may like our project turnaround time of only six to nine months from land acquisition to property launch.

“This helped us generate high returns on equity of about 21% last year,” Leong added.

Any investor or consortium interested in Mah Sing need not buy the company's shares from its major shareholders, namely Leong, Capital Group International Inc (with 9.69% equity interest) and Koperasi Permodalan Felda Bhd (8.55%).

Interested parties can accumulate the company's shares from the open market or from other substantial shareholders.

Leong declined comment on whether other major shareholders wanted to dispose of their stakes in Mah Sing.

Mah Sing's share price rose 15 sen, or 9%, to RM1.86 in the first hour of trading yesterday, but closed 6 sen up at RM1.77. Trading volume ballooned to 4.97 million shares versus 1.27 million shares on Monday.

Leong believed that should a foreign partner emerge in Mah Sing, it would pave the way for the group to expand abroad.

“We are now exploring opportunities regionally, such as in Vietnam, China, India, but we are not in a hurry to go overseas since we have good projects at home that are doing well,” he added.

Mah Sing currently has 14 projects in the Klang Valley, Johor Baru and Penang.

“These projects should be sufficient to generate healthy earnings growth,” Leong said, adding that the company's RM241mil cash pile would enable it to embark on more projects.

For the six months ended June 30, Mah Sing posted a higher net profit of RM38.3mil against RM31.3mil in the previous corresponding period. Earnings per share (EPS) came in at 8.1 sen.

Market consensus forecasts the company achieving an EPS of 13 sen for the current year ending Dec 31.

By The Star (By Kathy Fong)

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