The Star Online: Business
The Star Online: Business |
- MRCB to sell Platinum Sentral office building for RM750mil
- Final China HSBC PMI dips to 6-month low in January
- Westports trading at IPO price of RM2.50
| MRCB to sell Platinum Sentral office building for RM750mil Posted: 29 Jan 2014 08:00 AM PST PETALING JAYA: Malaysian Resources Corp Bhd (MRCB) has inked an RM750mil deal to sell its Platinum Sentral office building in KL Sentral to Quill Capita Trust Bhd. Yesterday's announcement confirms a report by StarBiz earlier this week. The transaction, said to be the first of its kind in the country, sets up construction-cum-property developer MRCB to be the single largest shareholder of Quill Capita Trust, as well as the owner of its management vehicle. The heads of agreement (HOA) was signed yesterday. Quill Capita Trust, an office-based real estate investment trust (REIT), will pay for the building with RM486mil in cash and RM264mil in new Quill Capita Trust units at RM1.32 apiece, both companies said in filings to the stock exchange. Quill Capita Trust intends to fund the purchase using borrowings and the issuance of new units. Platinum Sentral consists of five blocks with four-to-seven stories of commercial buildings housing office-cum-retail space, a multi-purpose hall and two levels of car parks. Its office space, with a net lettable area of 450,000 sq ft, is 100% occupied, although its 79,000-sq-ft retail portion is only 20% occupied, according to HwangDBS Vickers Research. MRCB has also agreed to acquire 41% in Quill Capita Management Sdn Bhd (QCM), the vehicle that manages the REIT, from CapitaLand RECM Pte Ltd and Coast Capital Sdn Bhd, both at a multiple of 10 times the profit after tax of QCM for the financial year ended Dec 31, 2012. Meanwhile, Quill Resources Holding Sdn Bhd, one of QCM's existing shareholders, will take up an additional 9% stake from Coast Capital, also at 10 times price-to-earnings. If the deal goes through, then CapitaLand RECM and Coast Capital stand to gain RM5.74mil and RM1.43mil for their equity in QCM, respectively. All parties have 30 working days to sign the definitive sale and purchase agreement. CapitaLand RECM is related to Quill Capita Trust's Singaporean shareholder CapitaCommercial Trust, which currently holds a 30% interest in the REIT, while Coast Capital is a bumiputra party. Quill Resources Holding, meanwhile, is a unit of the Quill group. In a statement, MRCB group managing director Datuk Mohamad Salim Fateh Din said the HOA would help generate dual income streams via dividends from Quill Capita Trust and the management fees from its stake in QCM. The move is in keeping with the strategy to establish a listed platform that would enable MRCB to monetise its future investment properties in exchange for tradable and liquid securities. MRCB is expected to emerge as a 30% shareholder in Quill Capita Trust once the exercise is complete. The REIT will also see its asset base balloon to RM1.5bil. HwangDBS Vickers noted in a report released before the announcement of the exercises that depending on the terms, the injection of Platinum Sentral into Quill Capita Trust could be earnings accretive for the latter. |
| Final China HSBC PMI dips to 6-month low in January Posted: 29 Jan 2014 05:57 PM PST BEIJING: Business conditions for China's manufacturers worsened in January as output and new order growth weakened, a private survey showed on Thursday, pointing to a weak start for the economy in 2014. The Markit/HSBC final manufacturing PMI for January dipped to 49.5 from December's 50.5, the first deterioration in six months. The figure was in line with the 49.6 reported in the preliminary version of the PMI released a week earlier. A reading below 50 indicates a contraction while one above shows expansion. The survey, an early indication of sentiment in the 56.9 trillion yuan ($9.4 trillion) economy, found growth rates in output and new business weakening, while companies cut jobs at the fastest rate since March 2009. "A soft start to China's manufacturing sectors in 2014, partly due to weaker new export orders and slower domestic business activities during January," said Hongbin Qu, chief economist for China at HSBC, in a statement. "Policymakers should pay attention to downside risks and pre-emptively fine-tune policy to steady the pace of growth if needed." Last week's flash PMI reading, which coincided with renewed signs of tightening in China's financial markets, had contributed to a fall in global markets as investors fretted over the impact worldwide of a China slowdown. However, many economists and experts say that Beijing will act if the economy loses traction too quickly even as it pushes towards more balanced and sustained economic growth. China's leaders have pledged to push reforms to unleash new growth drivers as the world's second-largest economy loses steam, burdened by industrial overcapacity, piles of debt and soaring house prices. That means reducing government intervention to allow market forces to have a bigger say in allocating resources, and promoting domestic consumption at the expense of investment and exports. China's annual economic growth slowed to 7.7 percent in the fourth quarter of 2013 from 7.8 percent in the previous quarter, putting full-year growth at 7.7 percent, sightly ahead of the government's target of 7.5 percent. While the economy narrowly missed expectations for full-year growth to fall to a 14-year low in 2013, some economists say a further cooldown will be inevitable this year as officials hunker down for difficult reforms. Still, the majority view of China economists polled by Reuters remains that Beijing will manage to sustain economic growth broadly in line with both last year's 7.5 percent growth target and the International Monetary Fund's predictions. Sources with top think-tanks have said the government likely will stick with the 7.5 percent target this year. The PMI showed a reduced amount of export orders in January, indicating weak demand overseas, and an increase in inventories. - Reuters |
| Westports trading at IPO price of RM2.50 Posted: 29 Jan 2014 05:33 PM PST KUALA LUMPUR: Westports Holdings Bhd which was listed on Oct 19, 2013, is currently trading at its initial public offer price of RM2.50 in early Thursday trade on lack of interest from investors due to the current volatile market environment. At 9.23am, it was unchanged at RM2.50. There were 1,000 shares done at prices ranging from RM2.50 to RM2.51. The FBM KLCI fell 5.64 points to 1,783.59. Turnover was 126.51 million shares valued at RM92.28mil. There were 66 gainers, 220 losers and 126 counters unchanged. When it made it debut, it was the country's biggest listing year-to-date and climbed to an intra-day high of RM2.71. Westports' IPO involved an offer for sale by existing shareholders of their combined stake of 23.84%, or 813.19 million shares, at a retail price of RM2.50 apiece. However, the wind was taken out of its sail when several days later on news that its biggest customer, CMA-CGM is looking to move its transhipment hub from Westports to Port of Tanjung Pelepas, which is owned by MMC. In late December, the government and Port Klang Authority (PKA) extended Westports concession period for a period of 30 years. Kenanga Research says the announcement is not a surprise given Westports's operational excellence better than average cargo handling efficiency in the past 10 years. In January 2014, MIDF Equities Research revised upwards its target price for Westports from RM2.56 to RM2.65 on news the port operator plans to submit an application for container tariff hike to PKA. |
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