Sunday, January 7th, 2018


Mattan hopes to raise RM30m from IPO in first half of 2018

PETALING JAYA: Mattan Bhd, an engineering, procurement, construction and commissioning (EPCC) solutions provider for renewable energy (RE) infrastructure, is planning an initial public offering (IPO) on the ACE Market of Bursa Malaysia in the first half of 2018 and intends to raise RM30 million from the exercise.

Chairman Levin Tan (pix) said the proceeds will be used for the acquisition of a 2MW biogas concession in Endau, Johor, and to finance its future participation in large-scale solar farm projects.

“The ‘Berhad’ status is like a passport for us to do business abroad, especially when it comes to dealing with foreign government entities. In a similar fashion, it enhances our opportunities locally but it is also equally important for our foreign ventures,” Tan told SunBiz in an interview recently.

Mattan plans to submit its IPO application to Bursa Malaysia after Chinese New Year. It has appointed MIDF Investment Bank Bhd as the underwriter for the IPO.

Mattan’s services cover EPCC solutions, including financing arrangement for all RE projects in Malaysia and Asia. As a consultant and system integrator, Mattan designs and manages multi-disciplinary RE projects spanning solar, biogas, biomass and mini hydro from the early stages of site assessment, feasibility study, design and quota application, financing arrangement to the project management of the construction, data collection, and operation and maintenance.

By end of 2018, Mattan is expected to have a portfolio of completed projects of more than 90MW solar installation on rooftop/solar farm and 10MW biogas projects in Malaysia and Asia.
Its subsidiary Mattan Engineering Sdn Bhd is undertaking the design, construction and operation works of a large-scale solar 50MW photovoltaic generation facility in Rembau, Negri Sembilan, which is one of the largest solar farms in the country.

Mattan has an order book of RM300 million (2017-2018) and it plans to enter the RE markets in Cambodia, the Philippines, Indonesia and the Middle East in 2018. The company is tendering for RM2 billion worth of projects in Indonesia and Cambodia.

“The idea is to expand the platform across Southeast Asia. The dream of the company, under a five-year plan, is we want to be a Southeast Asian powerhouse for RE,” said Tan.

He added that if it wins one of the three 30MW projects in the country, it will become the largest EPCC contractor for RE in Malaysia.

“We should use this advantage to move overseas because Southeast Asia is in its infancy (below 10 years) for RE.”

He added that there are limitations in Malaysia under a quota and bidding system.

Tan said Mattan is targeting to level its solar and biogas businesses to 50:50 in the next two years, from 70% solar and 30% biogas now, as the potential for biogas is huge given that there are over 400 mills in Malaysia, with 300 mills in Peninsular Malaysia alone.

He said RE in Malaysia is segmentised and more often than not, saturated in one segment, while Mattan has the capability to deliver multi-disciplinary RE projects.

Japan pulls out all stops in bid for KL-Singapore HSR deal

KUALA LUMPUR: Japan is making an all-out bid for the Kuala Lumpur-Singapore High Speed Rail (HSR) contract to construct Southeast Asia’s largest ever infrastructure project.

The Japanese package would be a truly holistic one with the best HSR technology via the first invented and world-renowned high-speed railway system, the Shinkansen, plus total transfer of technology and local vendor development to greatly benefit Malaysian and Singaporean companies, including small and medium enterprises, said the Japanese ambassador to Malaysia, Makio Miyagawa.

“We will be offering our best-suited technologies to Malaysians and Singaporeans as well as full-fledged training for the officials, operators and engineers of both countries so that they can start the operations by themselves from Day One.

“Japan would also like to offer the most comprehensive financial package which would certainly help the two nations to reduce as much of their financial burden as possible in introducing this system,” Miyagawa told Bernama in an interview.

Bids for the HSR, described as a game-changing joint venture between Malaysia and Singapore, must be submitted by the middle of this year with the contract expected to be awarded by year-end.

Other bidders for the project may include those from China, South Korea and France.

The 350km HSR is intended to cut travel time between Kuala Lumpur and Singapore to 90 minutes and stimulate the economy of several localities along the route, and it is projected to start operations around 2026.

Malaysia’s MyHSR Corporation Sdn Bhd and Singapore’s HSR Private Ltd announced on December 20 last year that they would start accepting bids for a railway “assets company” which will be responsible for designing, building, financing, operating and maintaining all rail assets.

Second Finance Minister Datuk Seri Johari Abdul Ghani was reported to have said that the project, which will have eight stations, would cost RM50 billion-RM60 billion.

Miyagawa pointed out that Japan’s engagement posture would tie closely with the country’s long-standing philosophy of economic assistance particularly in Asia.

“The philosophy of our economic assistance has all along been in such a way that Japan has assisted the recipient nations to stand on their own feet. It would not like to dominate the benefits but to share them. It would withdraw from the operation when you are ready to take over. If you would like us to stay on for some years, we would. It is not the Japan’s way to win (a contract) and run away. That would be irresponsible,” the ambassador added.

He said Japan had already been offering technology, human capital and financial resources to enable its companies to collaborate with companies in Malaysia and Singapore so that the all the companies and private sector could go hand in hand to advance together.

“In the high-speed rail system, our government and private sector would be ready and are very keen to collaborate with the local industries in Malaysia and Singapore so that the gradual transfer of technology and human capital will succeed and will help newly-introducing technology nations like Malaysia and Singapore to operate the system right from the start,” he added.

And he said that this long-lasting project would certainly invigorate and reinvigorate as well as reenergise the economies of Malaysia and Singapore linking up the two cities as well as mega cities now prospering in Asia.

“The connectivity will increase and along the alignment many cities will flourish. And that is why we are very happy to participate in this project.”

Japan’s edge over other bidders, Miyagawa said, should be viewed from the most important aspect in any public transport system – safety.

Here, Japan has an impeccable record recognised worldwide.

“Japan invented the bullet train technology. The advantage of the Shinkansen is that it has been operated for almost 50 years without any fatal accident or human capital problems. This is the merit of the system which is based upon the superiority of the hardware as well as the excellence of the software operations based upon the accumulated know-how of the engineers and operators in Japan,” he said.

Iraq to export Kirkuk oil to Iran before end-Jan, says Iraqi oil minister

BAGHDAD, Jan 7 — Iraq will start exporting oil from the northern Kirkuk fields to Iran before the end of January, Iraqi Oil Minister Jabar al-Luaibi told reporters on Sunday in Baghdad. About 30,000 barrels per day of crude will be trucked to…

China-backed AIIB may launch US dollar bond by end-June, says state media

BEIJING, Jan 7 — The China-backed Asian Infrastructure Investment Bank (AIIB) may issue its first US dollar-denominated bond by the end of June this year, according to a state media report on Sunday citing the bank’s treasurer Soren Elbech….

Crude Palm Oil Weekly Updates – January 6, 2018

Malaysian palm oil futures rose to their highest in one month in early trade, charting a second consecutive weeks on track supported by related edible oils and on expectations of stronger demand in the coming weeks. The benchmark crude palm oil futures (FCPO) contract rose 3.68 per cent to RM2,590 on Friday, which is RM92 […]

Malaysia Airlines expects to break even this year

KUALA LUMPUR, Jan 7 — Malaysia Airlines Bhd (MAB) aims to at least break even this year despite facing global economic and geopolitical challenges, competition, and uncertainty in foreign exchange and fuel prices. Group Chief Executive Officer…

Bursa Malaysia’s bull run to continue

KUALA LUMPUR: Bursa Malaysia’s bull run is expected to continue underpinned by the favourable outlook for global growth coupled with positive domestic catalysts. Inter-Pacific Securities Sdn Bhd Research head, Pong Teng Siew, said the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) would extend the upward trajectory, to reach the 1,826-level or even higher to 1,840- […]

Malaysia Airlines aims to at least break even this year

KUALA LUMPUR: Malaysia Airlines Bhd (MAB) aims to at least break even this year despite facing global economic and geopolitical challenges, competition, and uncertainty in foreign exchange and fuel prices.

Group CEO Captain Izham Ismail said MAB's current operations and finance are not yet viable, recording inconsistent monthly and weekly profits.

“No doubt we have reset ourselves, we’ve shrunk slightly, we will grow again, but (my) first job is to make this company sustainable again.

“We can still go to four corners of the world through good partnerships with other airlines, synergy with other airlines, but we taking few steps back and I don’t see why we can’t grow again,” he said in an interview on TV3 recently.

Izham said Malaysia Airlines is currently developing a medium-term strategy, which includes enhancing partnerships with other airlines to improve its network of routes.

Not only that, Malaysia Airlines is aware that it could not compete directly with low-cost airlines on several routes, as well as the need to switch to other routes more suited to its aircraft and business model.

However, for the time being, the main focus is to work with other major airlines that provide access to important routes in Europe besides India.

Currently MAB is planning to expand its operations to several new routes.

“While waiting for Malaysia Airlines to grow into a 120-airplane company, there must be an intermediate strategy, this is through partnership, as long as the 14,000 people and whole country (give the) support, there is no reason to fail,” he said.

Izham took over as group CEO on Dec 1. He is no stranger to the national carrier, having spent 38 years at the airline and handled 18 portfolios in the last 20 years.

Asked about the possibility of the national carrier being renamed as proposed by former CEO Christoph Mueller in 2015, Izham said the value of Malaysia Airlines is still strong.

“Our value (is) very strong, it’s our tradition, we are humble people, caring people, we help each other, we smile always, not negative towards others, I don’t see anything wrong with the brand, we probably had some issues in 2014, but the brand is stronger than ever (now),” he said.

Moving forward, Malaysia Airlines is expected to introduce three to four new routes a year to suit the specifications new aircraft that it would take delivery of.

In fact, Izham hinted that the airlines will introduce more different destinations and not only focus on certain markets.

“Malaysia Airlines needs to smartly distribute our basket equally, not only on Australia, not only Europe, we need also to focus on China, Indonesia, equally spread out our basket. If one region is not economical, we have other routes,” he said.

The restructuring plan of Malaysia Aviation Group, which includes MAB, will be announced at the end of March.

Currently, a detailed study is being carried out at the operational level of branches of all MAB’s subsidiaries, including Firefly, Maskargo and AeroDarat Services, to ensure that the organisation is restrengthened.

Izham said Malaysia Airlines should not be just one plan, but should be prepared with some plans, in order to face various possibilities.

With the exception of Maswings – whose mandate was given by the government to link Sabah’s and Sarawak’s cities with Peninsular Malaysia – the objectives of other subsidiaries in the group should be scrutinised.

“Moving forward, we are also reviewing what is the prime objective of Firefly, what’s the objective of AeroDarat, if it makes sense for MAB to have a cargo division. I am reviewing all these and then by the end of the first quarter, I’ll have a more concrete (picture), to make (the) organisation structurally stronger,” Izham said.

On Malaysia Airlines’ Project Amal (to cater specifically for haj and umrah pilgrims), which was introduced by his predecessor, he said it will be continued.

“We anticipate getting the licence at end-Q3 or Q4. Project Amal will commence operations with its planes, sometime in late 2018. Meanwhile, the assets will be utilised by MAB,” he said.

Projected as the world’s first airline to cater specifically and only to haj and umrah pilgrims, Projek Amal, which will use the Airbus A380, it will be on its own first, before opening potential cooperation and investment to outsiders. – Bernama

Malaysia weekly bond market updates 7 January 2018

The Malaysian bond market welcomed the year of 2018 with the ringgit continued to strengthen to an impressive 3.9980 against US dollar on Friday. The TR BPAM All Bond Index also gained 0.169 per cent, ending the week at 156.436 points compared to 156.172 points last Friday. The gain was underpinned by the strength in […]