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Tuesday, October 11, 2011

SP Setia's Liew gets 'sweet' offer

Kuala Lumpur: Permodalan Nasional Bhd (PNB) wants Tan Sri Liew Kee Sin to remain at the helm of SP Setia Bhd, following its proposed takeover of the company.

Analysts said if Liew remains as chief executive officer, there is a strong possibility the various funds with sizeable stakes in SP Setia may not accept the takeover offer and instead choose to remain as shareholders in the company.

As at December 23 last year, the various funds, excluding the Employees' Provident Fund, owned close to 19 per cent of SP Setia while as of last Friday, the EPF holds a 14.95 per cent stake.

The funds are not expecting better offers from rival bidders, considering the size of the takeover, which is said to be the biggest in more than two decades.

PNB is offering shareholders RM3.90 a share, as well as 91 sen for every warrant they hold, after it raised its stake in SP Setia to 33.2 per cent last month, exceeding the 33 per cent threshold.

In their first joint statement to Bursa Malaysia, PNB said it appreciated the strong branding of SP Setia, thanks to its entrepreneur-led management team.

"Liew will continue to lead SP Setia as its CEO... the existing management team will also continue to manage the company," said PNB in the statement.

The asset manager also said "it is committed, once markets stabilise, to maintain an appropriate shareholding spread with the capacity to attract not just local but also foreign institutional funds and retail participation".

Liew, in the same statement, said he was "heartened" by the reassurance from PNB president Tan Sri Hamad Kama Piah at their meeting last Friday.

The tycoon, who joined the SP Setia board in 1996, owns 11.26 per cent of the company and is widely recognised as the main driving force behind its transformation into one of the country's biggest property developers.

TA Securities property analyst, Tan Kam Meng, said following PNB's assurance that it would not be involved in the day-to-day operations of SP Setia, it is now unlikely that Liew will accept the (RM3.90 a share) offer.

"This should lend support to the share price as PNB is expected to continue buying SP Setia shares from the open market at any price below RM3.90 per share."

PNB said its involvement in its investee companies is mainly through board representation, while the day-to-day operations are left to professional managers.

Mercury Securities head of reseach, Edmund Tham, said the statement seems to indicate that Liew may not be seeking alternative bidders.

He said since there is no update from AmInvestment Bank as the independent adviser, investors may opt to take up the offer or hold on to the shares.

"The immediate concern for the public investors would be the liquidity of the shares, meeting the public spread requirement (at least 25 per cent) and the listing status."

Liew, meanwhile, reiterated SP Setia board's advice to non-interested shareholders to wait for both PNB's offer document as well as the independent advice circular before deciding on their next move.

When contacted, an SP Setia official said the company needs to see the whole process through before it can comment further.

By Business Times

Hamad: PNB not taking active role in SP Setia

PETALING JAYA: The nation's largest asset manager, Permodalan Nasional Bhd (PNB), has taken the step of reassuring stakeholders of property developer SP Setia Bhd that it does not intend to seek an active role in the management of the latter despite a bid to increase its stake.

PNB president and group chief executive Tan Sri Hamad Kama Piah Che Othman, who issued a joint press release with SP Setia president and chief executive officer Tan Sri Liew Kee Sin, said the asset manager's role was to look for good companies to invest in and not to manage those companies.

Hamad had met Liew last Friday following concerns over the fate and future direction of the company after PNB made an offer of RM3.90 per share and 91 sen per warrant with the aim of increasing its stake to more than 50%.

“Tan Sri Liew will continue to lead SP Setia as its CEO. The existing management team will also continue to manage the company with the same high professional standards and spirit of excellence which has caused SP Setia to be voted number one developer in Malaysia time and again,” he said.

Hamad: ‘Liew will continue to lead SP Setia as its CEO.’

Hamad added that PNB's involvement in its investee companies was mainly through board representation, while the day-to-day operations were left to professional managers.

PNB was seeking to increase its stake in the company because there was a disconnect between the fundamental value and share price caused by the global market turmoil, he said.

“As a long-time shareholder of SP Setia, and more recently a substantial shareholder owning more than 30% of the company, PNB fully appreciates the strong branding and deep-embedded value which has been created in the company through its entrepreneur-led management team,” he said.

He said the asset manager was also committed to maintaining an appropriate shareholding spread with the capacity to attract not just local but also foreign institutional funds and retail participation once the market stabilised.

Liew, on the other hand, was heartened by PNB's reassurance that it would continue to work with the existing management.

He expressed confidence that SP Setia would continue to have a bright future with solid growth prospects and thus create greater value for all stakeholders with the strong backing of PNB as a supportive long-term institutional shareholder committed to working synergistically with SP Setia's management.

However, Liew reiterated the board's advice to non-interested shareholders to wait for both PNB's offer document and the independent advice circular before deciding on their next move.

“This is to enable all shareholders to make a more informed decision regarding their investment in SP Setia,” he said. AmInvestment Bank Bhd was appointed the independent adviser for the offer.

According to Bloomberg data, PNB together with Skim Amanah Saham Bumiputera has a total stake of 31.73% in the company.

By The Star

Mah Sing, China firm in deal on 3 towers at Mont' Kiara project

KUALA LUMPUR: Mah Sing Group Bhd, Malaysia's fifth largest property developer by revenue, has partnered a Chinese firm to build three towers at its RM408 million Icon Residence Mont' Kiara project in Mont' Kiara, Kuala Lumpur.

The firm, a diversified group from China, will build the towers in exchange for 96 units from Mah Sing.

The units are worth a combined of RM220.8 million, or an average RM1,200 per square foot, said Mah Sing group managing director-cum-group chief executive Tan Sri Leong Hoy Kum.

Icon Residence Mont' Kiara comprises three towers with a total of 260 units. Each unit is worth an average of RM2.3 million.

With the Chinese firm taking up 96 units, this would mean Mah Sing has sold 60 per cent of the project since the project launch in June this year.

Leong said this is the first arrangement between Mah Sing and the Chinese firm and also the first of its kind for the group.

He said this arrangement will free up the construction cost for Mah Sing, allowing the group to use its cash flow for other opportunities.

Leong added that it will also set a precedent for similar arrangements in the future for Mah Sing's other projects.

"This is a win-win arrangement for both parties as we believe there is plenty of upside to the project once it is completed, and Mah Sing effectively does not have to come up with further cashflow to complete the project," Leong said.

Dubbed an architectural masterpiece, Icon Residence Mont' Kiara is a one of its kind serviced residence and the first in the region to adopt a distinctive Mediterranean theme.

It will be Green Building Index and Green Mark compliant with some features, such as variable refrigerant flow air-conditioning system with energy saving benefits and automated waste collection and rain water harvesting system.

Leong said the project has attracted strong interest from Hong Kong, China, Singapore, Indonesia, Taiwan, Korea and Malaysia.

Meanwhile, Leong said Mah Sing will not revise its sales target of RM2 billion for 2011. The company has achieved RM1.7 billion as at September 2011.

By Business Times

VI Properties woos Malaysians to Canadian real estate

KUALA LUMPUR: Vision International Properties (VI Properties), a real estate investment group, aims to sell up to RM80 million worth of its properties in Canada within a year of opening its office in Malaysia.

A spokesman said the firm is confident of achieving the target in view of overwhelming demand for its properties in Canada from buyers and investors in the Asia Pacific region.

"The minimum investment starts from RM500,000 and after four months in Malaysia, we have sold every single unit of our first project, called the Royal Oaks Manor. We only have two units left for our second project, known as Foxbend Manor in Lethbridge.

"Looking at these developments, we are confident that the target can be achieved," the spokesman told Business Times.

VI Properties offers ready-built properties with positive and immediate cash-flow, whereby investors will receive individual title to their property immediately upon purchase.

"We only market residential properties with proven good track record in tenancy rate and high rental yields. Our properties are already rented, ensuring that investors receive returns from day one. We provide a hassle-free full-service property management programme, hence investors get paid every month.

"Investors can obtain a loan of up to 80 per cent of the purchase price at interest rates from as low as 2.35 per cent through the company's cooperation with HSBC Premier and TD Bank in Canada," the spokesman said.

The spokesman added that VI Properties concentrates on residential properties in Alberta, Canada where the "Silent Oil Boom" is located.

On why an office in Malaysia, the spokesman said the company sees the potential of having Kuala Lumpur as its hub for business expansion in Asia Pacific.

"Due to the economic slowdown in the US, Europe and the Middle East, VI Properties sees the opportunity to establish and expand the company's business in the Far East or Asia Pacific." the spokesman said.

To date, the firm has concluded 12 real estate investment projects across Canada.

By Business Times

Bina Puri unit secures RM20mil housing project

KUALA LUMPUR: Bina Puri Holdings Bhd's wholly-owned subsidiary Bina Puri Construction Sdn Bhd has secured a RM20.4mil project from Jabatan Perumahan Negara.

The 14-month job, to commence this month, would involve the construction of Taman Topaz housing project in Dengkil, Selangor, said group managing director Tan Sri Tee Hock Seng.

He said with the new project, the group's orderbook now stood at RM2.73bil.

“This year, we have secured new projects worth over RM1bil, which is consistent with our performance over the last few years,” he added.

By Bernama

Bina Puri climbs on housing contract

Bina Puri Holdings Bhd rose to its highest in almost a month after saying it won a RM20.4 million building contract from Jabatan Perumahan Negara.

The stock climbed 2.9 percent to RM1.08 at 9:02 a.m. Kuala Lumpur time, set for its highest close since Sept. 15.

By Bloomberg