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Tuesday, March 30, 2010

SP Setia buys Melbourne land for RM90m

Its wholly-owned unit, Setia International, plans to develop a high-density inner city integrated residential and commercial project on the land

SP Setia Bhd, the country's biggest property developer in terms of sales, has bought a piece of land in Melbourne, Australia, for A$30 million (RM90 million).

Its wholly-owned subsidiary, Setia International Ltd, signed a deal yesterday to buy the 4,340 sq m land, held under several certificates of titles, from S.L. Nominees Pty Ltd and Jonquil Pty Ltd.

It plans to develop a high-density inner city integrated residential and commercial project on the land.

The deal was brokered by Savills Australia following a tender process.
According to Savills, there was strong interest from local and offshore buyers, but SP Setia offered the best combination of terms and corporate strength which the sellers were looking for.

The group plans to finance the purchase with internally generated funds and external borrowings.

"Barring unforeseen circumstances and subject to Australia's Foreign Investment Review Board approval, the proposed acquisition is expected to be completed in the financial year ending October 31 2010," SP Setia said in a filing to Bursa Malaysia yesterday.

The group targets to launch the project within 18 to 24 months of the date of acquisition.

"The land is strategically located in the central spine of Melbourne's central business district, between A'Beckett Street and Franklin Street and between Elizabeth and Queen Streets.

"The site is a short walk to Melbourne's central shopping centre and railway station, and is close to the Queen Victoria Market."

SP Setia said the close proximity of the site to several premier Australian universities and colleges will enable the group to monetise its Malaysian customer base, many of whom have sent their children to further their education in Melbourne and have invested, or are looking to invest, in properties there.

Based on the 2006 census published by the Australian Bureau of Statistics, it is estimated that 29,174 Malaysian-born individuals now live in Melbourne.

SP Setia declined to reveal the expected gross development value or profits, saying only that the project "will offer a development potential which is at least equal to that of a similar project in Kuala Lumpur".

"Along with international expansion, the group will also continue to focus on acquiring new landbank in Malaysia for growth and reinvestment, given the many opportunities which still exist at home," its president and chief executive officer Tan Sri Liew Kee Sin said in a statement.

By Business Times

Malaysia pushing for more Middle East construction projects

DUBAI: Malaysian contractors are currently working on 51 projects worth US$10bil in the Middle East and are eyeing for more amid a projected upswing in construction demand.

The majority of projects are in United Arab Emirates, Saudi Arabia, Qatar, Bahrain, Oman, Syria, Iran, Jordan and Yemen, the Malaysia External Trade Development Corp (Matrade) said in a statement yesterday. In value terms, the Middle East contributed the highest share of 42% among the 614 overseas projects worth US$24bil in which Malaysian contractors have been involved from 1997 to 2009.

Datuk Noharuddin Nordin ... ‘Malaysian expertise in infrastructure building has been deployed in 73 projects across the Middle East.’

“Malaysian expertise in infrastructure building has been deployed in 73 projects across the Middle East, including landmark initiatives such as Burj Khalifa, Al Reem Island, Dubai Metro, Dubai Mall and Meydan Race Course,” Matrade chief executive officer Datuk Noharuddin Nordin said in the statement.

Construction companies in Malaysia foresee substantially improved demand from the Middle East as infrastructure outlay continued to top national budgets, it said.

Matrade cited a Business Monitor International study forecasting that the global construction industry could grow between 1% and more than 5% up to 2014.

The projected increase was on account of growth expectations in the Middle East, North Africa, China and India.

Matrade said Malaysian construction companies, which already have an international project portfolio of US$15bil, were aiming to lead the revival in key markets.

To seek further inroads in the Middle East, the Malaysian construction sector will attend the third Malaysia Services Exhibition (MSE) 2010 to be held at the Dubai International Convention and Exhibition Centre from April 13 to 15.

“The unique advantages we offer in terms of resources, skills, quality, cost and experience in mega projects give us a competitive edge over leading providers in the United States, Europe and other Asian countries,” Noharuddin said.

Organised by Matrade, MSE 2010 will showcase the world-class capabilities of Malaysian companies specialising in eight service clusters: professional services, oil and gas, construction, information and communications technology, healthcare, franchising, education and specialised training, and financial services.

The three-day exhibition will be attended by 150 establishments including 130 service providers, 12 professional associations and eight government agencies.

A major addition to Malaysia’s construction services portfolio at MSE 2010 will be environmentally friendly architecture and engineering.

By Bernama

MPC, Beijing Construction planning projects in Iskandar

PETALING JAYA: Malaysia Pacific Corp Bhd (MPC) and Beijing Construction Engineering Co Ltd are planning to undertake the construction and financing of two property projects in Iskandar Malaysia, Johor.

In a statement to Bursa Malaysia, MPC said its subsidiary LakeHill Resort Development Sdn Bhd and Beijing Construction had last Friday signed a letter of intent to evaluate the development and financing of Lakehill Resort City and Aptec City.

It said once Beijing Construction had evaluated the plans, the detailed terms and conditions of contract or contracts would be signed in the presence of both governments.

It added that Beijing Construction, which was one of the largest state enterprises of China, was among the largest construction and engineering companies in China where it had undertaken many major construction projects.

MPC said the letter of intent would map out the basis and the roles of the parties in pursuing the project, with a view to enabling Beijing Construction to hold discussions with third parties such as the Iskandar Regional Development Authority, Johor government and other relevant ministries.

By The Star

EPF to launch new housing loan scheme soon

KUALA LUMPUR: EPF contributors should hold off using the money in their Account II to buy a house until the new scheme which would enable them to obtain a higher housing loan is implemented.

Chief executive officer Tan Sri Azlan Zainol said while EPF was keen to launch the scheme as soon as possible it had to wait until the banks were ready to implement it.

“The banks are studying it. In principle, they are agreeable,” he told reporters at the International Social Security Association (ISSA) technical seminar here yesterday.

During the tabling of the Budget last October, Prime Minister Datuk Seri Najib Tun Razak had announced that the government would launch a scheme to enable EPF contributors to utilise current and future savings in Account II in January this year.

Najib said the scheme, which would enable EPF contributors to be eligible for higher financing to purchase higher value houses, was limited to a purchase of one house at any one time and subject to conditions stipulated by EPF.

During the tabling of the Budget, Najib had also announced the establishment of the 1Malaysia retirement savings scheme where, as an incentive, the Government would contribute 5%, subject to a maximum of RM60 per annum for every RM100 contribution in addition to the existing dividend paid by EPF.

This scheme is for the self-employed and those without fixed income such as taxi drivers, hawkers, farmers and fishermen, who retire without pensions or any form of EPF savings.

Azlan said the 1Malaysia retirement scheme had received encouraging response; it had recorded RM3.4mil in total savings from 8,000 contributors since its establishment on Jan 2.

Of them, 3,000 are self-employed traders.

While contributors can contribute a minimum of RM50 or a maximum of RM5,000 to the scheme monthly and may withdraw their savings upon attaining the age of 55, the Government’s contribution is only for five years.

By The Star

YTL to develop ‘prime real estate’ in Asia

YTL Corp, Malaysia’s biggest builder, plans to develop a “prime real estate” in Asia, Chief Executive Officer Tan Sri Francis Yeoh said in Kuala Lumpur today.

He also said it’s time to take a more “sizeable bite” in Japan’s property market.

By Bloomberg

Bolton inks land deal with Intrapuri

BOLTON Bhd yesterday entered into a deal with Intrapuri Sdn Bhd to acquire a piece of land in Jalan Peel, Kuala Lumpur, for RM39 million cash.

It will develop medium high-end service apartments on the 2.2ha property, with an estimated gross development value and gross development cost of RM280 million and RM220 million respectively.

Development of the property is expected to commence on completion of the proposed acquisition and after obtaining all the approvals from the relevant authorities, with an estimated development period of five years.

By Business Times

Bolton LYL buys land for RM39mil

PETALING JAYA: Bolton Bhd via subsidiary Bolton LYL Sdn Bhd has agreed to buy about 5.5 acres in Kuala Lumpur for RM39mil cash from Intrapuri Sdn Bhd.

It told Bursa Malaysia the proposed development of the land would consist of medium high-end service apartments with podium car parks and facilities with an estimated gross development value and gross development cost of RM280mil and RM220mil respectively.

It added that the development was expected to commence upon completion of the proposed acquisition and after obtaining all the approvals from the relevant authorities with an estimated development period of five years.

The development cost would be financed through internally generated funds and bank borrowings, it said.

By The Star

Partners to discuss Iskandar projects

MALAYSIA Pacific Corp Bhd has teamed up with Beijing Construction Engineering Co Ltd (BCEGC), one of China’s largest construction and engineering firms, to study the development and financing of the proposed Lakehill Resort City and Aptec City projects in Johor’s Iskandar Malaysia.

A letter of intent was signed last Friday, which allows BCEGC to proceed discussions with relevant third parties such as the Iskandar Regional Development Authority, the Johor state government and other relevant ministers.

By Business Times

Kuwait Finance House to step up investments in M’sia

PETALING JAYA: The ongoing due diligence audit at Kuwait Finance House (M) Bhd (KFH Malaysia) has not interfered with the bank’s aim to step up its investment portfolio in Malaysia.

A delegation from its parent company, led by Kuwait Finance House Group chief executive officer Mohammed Sulaiman Al Omar, recently met Prime Minister Datuk Seri Najib Razak and his deputy Tan Sri Muhyiddin Yassin to discuss the group’s intention for further investment in the country.

Specifically, the group is interested to spearhead the establishment of a world-renowned university in Medini Iskandar located in Iskandar Malaysia.

Jamelah Jamaluddin ... ‘The bank will always be guided by pragmatism and act according to the recommendations of the audit team.’

KFH Malaysia chief executive officer Jamelah Jamaluddin, who was appointed less than two months ago, said it was “business as usual” for the bank despite the ongoing due diligence audit.

She said the process was aimed at obtaining an accurate picture of certain transactions and contractual arrangements that had been undertaken over the years.

“This will facilitate a clear perspective of our operations and business to enable us to move forward,” she said in a statement yesterday.

Jamelah said some employees had taken leave to facilitate the exercise and internal re-organisation with the objective of strengthening the bank’s credit team and processes with the intention of improving asset quality.

“The bank will always be guided by pragmatism and act according to the recommendations of the audit team,” she said.

Following the ongoing due diligence audit, RAM Ratings placed the AA2/P1 financial institution ratings of the bank on negative rating watch on March 26.

This is because the audit heightened concerns on the potential for further deterioration in the bank’s asset quality and credit fundamentals.

RAM Ratings had a negative outlook on the financial institution ratings of KFH Malaysia last November, based on the deterioration in the financial metrics of both the bank and its parent.

RAM Ratings said pending comprehensive review, it would maintain close monitoring of the pertinent developments and reassess the ratings when more conclusive information was made available.

Jamelah said the bank also wanted to ensure that its employees were put in positions where their strengths would be fully utilised in line with its talent management strategies.

“We have a strong team in place and it is business as usual for the bank. In fact, we are stepping up our investments in Malaysia.

“Our capitalisation, which is equivalent to US$650mil provides us a strong footing for the bank to expand its portfolio,” she said.

In the same statement, Mohammed Sulaiman said KFH reaffirmed its commitment in its business strategy of fully taking advantage of the enormous opportunities in Malaysia and becoming a partner in Malaysia’s economic growth story.

“We are excited and keen on the country’s new economic model and remain positive on the outlook of Malaysia as it will be the platform for our expansion into the Asia-Pacific region.

“We want to play a vital role in the development of real estate projects in the Asia-Pacific region as well as the introduction of new Islamic financial products,” he said.

FH Group’s interest in the establishment of the university in Medini Iskandar is in line with its vision to have world-class educational institutions in adopting the university of the future concept there.

KFH Malaysia led a consortium to invest about US$329mil in Medini Iskandar via Medini Central Sdn Bhd in 2008.

By The Star

Lion plans more Parkson centres in Vietnam

HANOI: The Lion Group plans to open more Parkson shopping centres in Vietnam, to maintain the chain's development as well as expand their retail network, according to Vietnam news agency today.

Till today, the group manages 82 Parkson stores, with five in Vietnam, 42 in China and 35 stores in Malaysia.

Parkson is a popular department store company in Malaysia which offers items such as fashion, jewellery, cosmetics, furniture, electric goods and food.

Besides the Vietnamese and Chinese markets, Lion plans to enter the Cambodian and Indonesian and other Asean markets at the end of 2011.

By Bernama

KPJ Healthcare plans Asia expansion

KPJ Healthcare Bhd is looking into expanding its network aggressively in Asia beginning next year through acquisition, joint venture and management contract.

The destinations being considered were Indochina, India, Bangladesh, Pakistan and possibly Middle East, Managing Director Datin Paduka Siti Sa'diah Sheikh Bakir told reporters on the sidelines of Invest Malaysia 2010 Conference in Kuala Lumpur today.

"We have received a few offers from these countries and currently, KPJ is reassessing the offers. We hope to finalise them by end of this year to be able to kick off the plan next year onwards," she said.

KPJ presently owns 20 hospitals in Malaysia and two in Indonesia. It also manages two hospitals in Jeddah, Saudi Arabia.

For this year, Siti Sa'diah said, KPJ would only focus on domestic expansion and was in the midst of building two hospitals in Klang and Muar.

On the Al-Aqar KPJ Real Estate Investment Trust (REITs), she said KPJ hoped to complete the exercise of injecting three other hospital buildings (one in Indonesia and two in Malaysia) into REITs by June this year.

The company was waiting for the approval from the relevant authorities.

"This exercise creates more opportunities to acquire more hospital buildings, in particular in Indonesia, for further REIT injection," she said.

To date, KPJ has injected 18 hospitals and a nursing college building into REITs.

Meanwhile, she said KPJ had allocated about RM100 million to expand its existing hospitals and to upgrade facilities in Malaysia.

With the increasing demand for private healthcare services and its expansion plans locally and abroad, KPJ is confident to achieve a revenue of RM2 billion by 2012.

Currently, KPJ’s market capitalisation is RM1.5 billion and hopes to increase it to RM2 billion.

By Bernama