Tuesday, August 1st, 2017
NEW YORK, Aug 1 — Oil fell back below US$50 (RM214) as investors wait for more evidence that global markets are rebalancing. Futures fell as much as 1.5 per cent in new york after surging for the previous six sessions. US crude, gasoline and…
NEW YORK, Aug 1 — US automakers posted steeper sales declines than analysts estimated in July, reinforcing doubts that industry demand will be able to keep up with record levels seen the last two years. Deliveries plunged 15 per cent at…
PETALING JAYA: Paramount Corp Bhd is disposing of its Sri KDU Campus for RM165 million, which will be injected into the country’s first syariah-compliant unlisted real estate investment trust (REIT), Alpha REIT.
The REIT has been established to invest in syariah-compliant income-producing real estate used substantially for education or education-related purposes and is limited to institutional investors.
Alpha REIT Managers Sdn Bhd (the REIT manager) is a wholly owned subsidiary of AREA EduREIT Sdn Bhd, the promoter of Alpha REIT.
According to Securities Commission Malaysia regulations, Alpha REIT has three years to reach the required scale of at least RM1 billion in assets under management.
Alpha REIT Managers CEO Jeyabalan Parasingam said it aims to grow Alpha REIT’s assets to RM2 billion to RM3 billion within three years as it prepares for a listing on the stock exchange. The REIT’s initial portfolio will be RM305 million.
He said it has been engaging education providers over the past few years with a view to acquire their current real estate portfolios, and to assist them in their future expansion plans.
The REIT manager expects a second acquisition of an international school at RM140 million within a month.
Alpha REIT Managers chairman Datuk Stewart LaBrooy said unlisted REITs are limited to institutional investors due to their illiquid nature, although current REITs guidelines allow for the establishment of unlisted REITs where the units may be offered to both retail and sophisticated investors.
“Unlisted REITs are often viewed as illiquid and offer limited transparency compared with their public listed counterparts. This can be an issue with retail investors who usually lack holding power and ability to demand information,” he said in a statement yesterday.
“Nevertheless, the SC acknowledged that unlisted REITs can serve a purpose, providing REIT managers with an avenue to scale up their portfolio of income-generating assets before going for a listing, particularly when the assets are being acquired from multiple vendors who are not sponsors of the REIT,” he added.
In a filing with Bursa Malaysia yesterday, Paramount said its wholly-owned subsidiary Sri KDU Sdn Bhd entered into a master agreement and triple net lease agreement with RHB Trustees Bhd, the trustee for Alpha REIT.
Under the agreements, Sri KDU will sell its Sri KDU Campus in Petaling Jaya and lease the property from the trustee for 10 years with options to extend the lease for two renewal terms of 10 years each.
“The proposed disposal is in line with the group’s plan to pursue an asset light strategy. Monetising the group’s real estate assets through this sale-leaseback transaction enables it to unlock capital resources from being tied up in long term assets, providing growth capital and allowing the group to focus on its core activities to ultimately better reward shareholders,” it said.
The deal will see it book a gain of RM72.9 million.
Meanwhile, the proposed lease safeguards Sri KDU’s operations, allowing it to continue its business at its existing business premises without any disruption while locking in rental rates over a long-term period, eliminating the risk of volatility in rental rates.
The campus comprises three parcels of leasehold land measuring 48,363 sq m on which there are four buildings currently occupied by Sekolah Sri KDU and Sri KDU International School.
The net book value of the Sri KDU Campus is RM87.03 million based on Sri KDU’s latest audited financial statements for the financial year ended Dec 31, 2016.
Of the RM165 million proceeds, Paramount plans to use RM113 million for cut back on leverage, RM31.8 million to reward its shareholders and RM19.7 million as working capital.
Its shares rose three sen to RM1.87 yesterday, with 137,700 traded.
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KUALA LUMPUR: The Human Resource Development Fund (HRDF), which phased out the 1Malaysia Globally Recognised Industry and Professional Certification (1MalaysiaGRIP) programme last year, will be participating in another training and certification programme for which it will provide funding.
It has entered into a memorandum of understanding (MoU) with Technology Depository Agency Bhd, an agency under the auspices of the Finance Ministry and Asian Rail Academy to facilitate training and certification programmes for railway employees and fresh graduates.
The three will also be working with UK-based National Training Academy for Rail and Germany-based TUV SUD to roll out the re-skilling and upskilling programme, which will be conducted in virtual reality format. The programme can run from one to five days and could cost an average of RM5,000.
Employees from the railway sector according to HRDF CEO Datuk CM Vignaesvaran Jeyandran will be able to tap into HRDF’s fund. The fund is supplemented by the employer’s 1% levy contribution from the monthly wages of each employee.
“Those people who are paying the levy, they will be able to utilise (pool fund). The MoU says it (the programme) will be a two-year collaboration. If they come to us and ask for funding then we will look at it on a per request basis. There is no budget allocation (for the programme),” Vignaesvaran told SunBiz.
“It will depend on whether this particular programme kicks off or not. It is a good initiative if we look at the Malaysia rail industry, it is expanding, we are hoping that there (will be a) need for trained and certified workers,” he added.
Vignaesvaran said fresh graduates would be able to access funds through HRDF’s other schemes such as its graduate enhancement programme for employability. This programme according to Vignaesvaran is funded through the pool fund as well.
According to HRDF’s website the programme caters to unemployed graduates who are unable to secure a job at least three months after completion of their studies.
The initiative aims to equip them with “high-end and application based skills as required by industries.“
“The training will be offered either by the employer’s association appointed training provider or internal trainers of the employers,” the programme’s guidelines available on HRDF’s website read.
It said employer’s association will be able to claim 70% from the fund upon completion of training and 30% upon job placement.
“Upon completion of training, all trainees will be absorbed as employees as the training offered is to fulfill the manpower needs of the employer,” it was stated in the guideline.
Vignaesvaran said the remuneration to the employers will be based on performance, and if the graduate does not secure the job, the employer will not be paid.
It was previously reported in theSun that HRDF had phased out the 1MalaysiaGRIP in October 2016, which drew flak from employers who demanded their contributions be returned as 30% of their contribution was used for the program along with a matching grant.
HRDF, which had initially claimed that it had phased out the programme as funds allotted for it were fully utilised, later issued a circular stating that the balance of the pool fund were distributed to several employers associations and unions.
KUALA LUMPUR: Equity broking firm Rakuten Trade Sdn Bhd has announced its new rewards programme, which brings together three leading loyalty providers AirAsia BIG, B Infinite by Berjaya Group and BonusLink, under one ecosystem.
The Rakuten Trade rewards ecosystem will enable investors to earn Rakuten Trade points (RT Points) simply by trading on their platform.
Its managing director Kaoru Arai said it is introducing enhancements to its equity broking platform, the first of its kind in Malaysia.
“What makes the Rakuten Trade rewards ecosystem unique is our collaboration with AirAsia BIG, B Infinite, and BonusLink. Our affiliate partners will give Rakuten Trade the opportunity to provide a diverse range of benefits under one robust ecosystem. We believe this will hold tremendous appeal for the growing number of digitally savvy investors,” he said in a statement.
The Rakuten Trade rewards eco system is a free point rewards programme where investors can earn RT points from trading activities, introducing members by referral link/code, share transfer, and by participating in Rakuten Trade marketing campaigns.
Earning points is automatic for all Rakuten Trade customers. Earned RT points can then be converted into AirAsia BIG, B Infinite and/or BonusLink points of the same value.
BLoyalty Sdn Bhd director of retail and innovations Yau Su Peng said as B Infinite progresses in its transformation from the physical world in to the realm of mobile, it is imperative that it prepares for the growing preference among consumers for digital-based channels.
“B Infinite is constantly open to win-win partnerships that will benefit our members and believe that this collaboration with Rakuten Trade will well serve their lifestyle needs,” said Yau.
Arai said it wanted to differentiate its platform by giving retail investors an added advantage when they trade shares through Rakuten Trade.
“With AirAsia on board, one can redeem points for airline tickets or hotel accommodations while B Infinite and BonusLink points can be converted to everyday lifestyle needs from a cup of coffee to fuel.”
PETALING JAYA: Sunway Bhd is acquiring 20 acres of land from JAKS Resources Bhd and Concept Housing Development (M) Sdn Bhd for RM230.59 million.
In a filing with Bursa Malaysia yesterday, it said its unit Sunway Supply Chain Enterprise Sdn Bhd (SSCE) entered into an agreement with Premier Place Property Sdn Bhd (PPP), a wholly-owned subsidiary of JAKS Resources Bhd, to acquire 14.8 acres of Subang land for RM167.59 million or RM260 per sq ft (psf).
Sunway said the buy will provide the group with immediate access to four industrial lot use as warehouses and storage facilities in the immediate term by its trading and manufacturing businesses of the group. Any access capacity will be leased out.
“In the medium-term, Sunway plans to redevelop the land, which is strategically located for mixed use development,” it said, adding that the land’s strategic location and easy access to major highways will minimise transportation costs to clients.
In the longer term, the land will serve as valuable landbank for the property development division as it is close enough to Sunway City to be an extension of the group’s township. The land is also well served by amenities like malls and public transportation.
“It is estimated that the gross development value (GDV) for the future developments on the land will potentially be at least RM1.4 billion,” it added. The four parcels of land are located in USJ 1, Subang Jaya.
Sunway will fund the proposed acquisition through bank borrowings and internally generated funds.
JAKS Resources CEO Andy Ang Lam Poah said the exit from non-core assets and focus on utility and infrastructure projects are the key pillars of its corporate strategy.
He said the transaction, which is subject to approval from shareholders, will allow it to redeploy capital into reducing debt, support working capital needs and as capital reserves for future investment opportunities.
In addition to the four parcels of land, Sunway’s subsidiary Daksina Harta Sdn Bhd is acquiring 5.2 acres of freehold land in Kajang from Concept Housing Development (M) Sdn Bhd for RM63 million or RM274 psf.
The acquisition includes partially completed structures, which Sunway intends to continue building on but will replace the original development with a mixed development comprising retail podium/commercial lots and serviced apartments/SOHO units.
The indicative GDV of the proposed development is RM460 million and will take five years to develop. The proposed project is expected to be a transit oriented development due to its proximity to Sg Jernih MRT station.
The acquisition will be funded with bank borrowings and/or internally generated funds and will be completed by February 2018.
Sunway’s shares rose 1.64% to close at RM4.35 with a total of 3.92 million shares traded, giving it a market capitalisation of RM8.90 billion.