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Thursday, April 23, 2009

MBSB plans to finance RM300mil property project

PETALING JAYA: Malaysia Building Society Bhd (MBSB) is looking to finance a property project worth RM300mil under its newly launched MBSB Musharakah Joint Venture Programme.

“We are talking with a company, with the involvement of government-linked companies,” chief executive officer Ahmad Zaini Othman said after the soft launch of the programme here yesterday.

MBSB, a 52.9% subsidiary of the Employees Provident Fund, specialises in personal financing, mortgage and corporate businesses, as well as treasury and structured funds.

Ahmad Zaini said the latest programme was in line with MBSB’s new direction to reposition itself in the Islamic financial market.

Considered the first of its kind in Malaysia, the programme offered partnership in property development, contract financing and object/asset financing, especially to developers, land owners and contractors, he said.

According to Ahmad Zaini, the programme offers attractive margin of financing and assured project completion.

“It will enable MBSB to undertake corporate financing activities on a joint-venture basis, using the underlying Islamic financing contract of musharakah,” he said.

He said for MBSB to gain a stronger footing in musharakah, the company was now in talks with a local Islamic bank to form a partnership.

“We hope for the partnership to take shape in May or June, which will provide us with an avenue for greater resources,” he said.

By Bernama

MBSB set to build RM300m property via musharakah

MALAYSIA Building Society Bhd (MBSB), a finance company, said it is poised to partner a government-linked developer to build a RM300 million property under its latest Islamic finance product.

It launched the musharakah programme yesterday, basically a joint venture concept where the lender and partner work on a venture and share the profits and losses, unlike conventional banking.

This is the most preferred and globally accepted financing structure, especially in the Middle East. However, it has yet to make it big in Malaysia.

"This is an untapped market and we are excited of the prospects for our programme," MBSB chief executive officer (CEO) Ahmad Zaini Othman told a briefing after the launch in Petaling Jaya yesterday.
Last year, musharakah made up only 3 per cent of the total approved Islamic financing of RM30 billion in Malaysia.

"Ours is a business model, not a lending model. We have an investment committee and not a credit committee like banks do," he said.

Ahmad Zaini, who was formerly AmIslamic Bank CEO, said since MBSB is not under Bank Negara Malaysia, there was no need for the central bank's approval for its musharakah programme.

MBSB is exempted from the banking law and it reports to the Finance Ministry and not Bank Negara.

Ahmad Zaini said the approval process for this financing will be rigorous as MBSB only wants genuine partners.

"We have to do this strategically and be a responsible partner."

MBSB is 67 per cent owned by the Employees Provident Fund and about 15 per cent by Permodalan Nasional Bhd.

By Business Times (by Roziana Hamsawi)

Tanjung Manis Halal Park rakes in RM9b

The Tanjung Manis Halal Park, located on the west coast of Sarawak, has attracted RM9 billion in investments since its launch in February this year.

The Halal Industry Development Corporation (HDC) chief executive officer Datuk Seri Jamil Bidin, who disclosed this said, the investments comprised RM6 billion from six Taiwanese companies and the remaining by local ventures.

The companies concerned are involved in agriculture, biotechnology and food-related businesses, he told reporters after the launch of the World Halal Forum in Kuala Lumpur today.

The Tanjung Manis Halal Park is the first one-stop halal park in East Malaysia for upstream and downstream halal food and manufacturing.

By Bernama

Binaik fourth to be taken private this year

Binaik Equity Bhd, a property developer, is set to be taken private in a deal worth some RM19 million, making it the fourth company that wants its shares to be taken off Bursa Malaysia this year.

Minority shareholders will be offered 75 sen a share, 23 per cent higher than its last closing price of 61 sen on Monday.

The stock was suspended from Tuesday and will resume trading today.

Binaik's major shareholder, Yeo Brothers Sdn Bhd (YBSB), has sent a letter to the board, asking the company to consider the privatisation.
The main reason for this is the poor trading volume of its shares.

"The average daily trading volume of Binaik shares for the past three years up to April 20 was approximately 37,000, representing only 0.15 per cent of Binaik's current public shareholding spread of 25 million shares," the company said in a statement to Bursa Malaysia yesterday.

Binaik will carry out a selective capital repayment exercise for the privatisation. This means that the company will return its capital to shareholders, excluding those who will not participate, normally the major shareholders.

YBSB and its related parties, which hold a total of 74.41 per cent of Binaik, will not take part in the repayment.

The Johor-based Binaik will use internal funds, borrowings, or a loan from YBSB to fund the repayment.

The company was barely profitable last year. It made a net profit of RM41,000 compared with RM1.3 million in financial year 2007. Revenue, however, increased to RM80 million from RM72.2 million in 2007.

Binaik will have to hold a shareholder meeting to seek approval for the capital repayment. It has hired HwangDBS Investment Bank Bhd as its adviser and expects the deal to be done by the end of September.

By Business Times