Wednesday, January 24th, 2018

 

TH Heavy to receive RM374m from FPSO novation agreement with Yinson

PETALING JAYA: TH Heavy Engineering Bhd (THHE) today said it will receive RM374 million cash as proceeds of its novation agreement with Yinson Holdings Bhd for the floating, production, storage, offloading facility for the Layang Development awarded by JX Nippon Oil & Gas Exploration (Malaysia) Limited.

Some RM352.8 million have been earmarked as payment for scheme creditors.

In explaining the circumstances which led to the novation agreement, THHE explained that it was unable to achieve the original handover date to JX Nippon scheduled on June 30, 2016 due to the inability to complete the conversion works of FPSO Layang Vessel because of THHE’s inability to raise the necessary funding.

The physical completion of the FPSO Layang Vessel is 42.92%. As the conversion of the FPSO Layang Vessel has yet to be fully completed, it is presently not fit for use and not of sea-going condition.

Post completion of the Proposed JX Nippon Contract Novation and other components of the proposed regularisation plan of THHE, the FPSO Layang Vessel will continue to be held as a capital asset of THHE.

Worth noting is that the registered owner of the FPSO Layang Vessel is Floatech (L) Limited, which is THHE’s 80%-owned subsidiary company. The remaining 20% interest is owned by Globalmariner Offshore Services Sdn Bhd (GMOS). GMOS, which is also a scheme creditor, has appealed to the High Court to prevent the novation agreement between THHE and Yinson from proceeding. The result of the appeal and subsequent actions by both GMOS and THHE will have a bearing on the outcome of the novation agreement.

In the off chance the novation agreement does not go through, THHE will have to pay delay liquidated damages to JX Nippon to the tune of US$18.6 million (RM75.3 million).

THHE's unaudited consolidated statements of financial position as at Sept 30, 2017, the group’s borrowings and trade and other payables as at Sept 30, 2017 is RM350.9 million and RM654.9 million respectively.

The group's share price closed half a sen to 11 sen, with some 10.8 million shares changing hands.


US stocks add to records amid earnings deluge

NEW YORK, Jan 24 — Wall Street stocks added to records early today following a trove of corporate earnings that largely reaffirmed confidence that US tax reform would lift corporate profits in the medium-term. “There is a real appreciation…


SC wins insider trading case against WCT Bhd co-founder/former director

PETALING JAYA: The High Court today declared that the Securities Commission Malaysia (SC) had successfully proven an insider trading case against WCT Bhd co-founder and former director Chan Soon Huat.

In the suit that was filed in 2015, the SC claimed that Chan had breached Section 188(2)(a) of the Capital Markets & Services Act 2007 when he disposed of a total of 2.41 million shares and 1.24 million warrants in WCT between Dec 30, 2008 and Jan 5, 2009 while in possession of material non-public information.

Justice Datuk Abu Bakar Jais ordered Chan to pay a sum totalling RM3.24 million, three times the losses avoided by Chan as a result of the insider trading.Chan was also ordered to pay a civil penalty of RM500,000 to the SC.

The SC alleged that the material non-public information referred to in the action related to the cancellation of a contract for the proposed construction of the “Nad Al Sheba Dubai Racecourse” in Dubai, the United Arab Emirates, which was awarded to a joint-venture company set up by WCT and one Arabtec Construction LLC. The announcement was made on Jan 6, 2009.

Chan was said to have disposed of the WCT shares and warrants through his own account and also the account of his daughter, Chan Choon Chew and his son-in-law, Leong Weng Wah.


CPTPP to be signed in Chile on March 8

KUALA LUMPUR:The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is slated to be signed on March 8, 2018 in Chile after a breakthrough in which all member countries agreed on four country-specific issues, including those which are to Malaysia’s interest.

In a statement today, Minister of International Trade and Industry, Datuk Seri Mustapa Mohamed, said this date, however, would have to be formally confirmed by the CPTPP ministers.

“The CPTPP would benefit the country in terms of expanding consumer choices on goods and services in our market,” he said.
Mustapa said Malaysia expected additional jobs to be created as a result of further investment that would come in due to the improved trading and investment environment under the CPTPP.

“We are satisfied with the outcome of this meeting and our negotiators have once again successfully defended Malaysia’s interests,” he said.

The trade minister said he would table the outcome of this meeting to Cabinet for its consideration and resume the engagement process with the relevant stakeholders should the Cabinet decided to grant its approval.

To recap, chief negotiators of the 11 CPTPP member countries met in Tokyo for two days starting Jan 22, 2018 as a follow up from the ministerial meeting that was held in Da Nang, Vietnam on Nov 10, 2017.

The Tokyo meeting has achieved a breakthrough in which all member countries have come to an agreement on these four country-specific issues, namely, state-owned enterprises – namely on Malaysia’s request for additional flexibility to conduct preferential purchases for the upstream oil and gas sector, in which the commitment to limit the transition period would now commence on the date of entry into force, instead of the date of signing as per the previous arrangement.

Others were on market access for the coal industry, trade sanctions related to dispute settlement and exceptions for cultural industries.

“These issues were supposed to have been resolved much later,” said Mustapa.

He said before the Tokyo meeting, there were 20 provisions that would be suspended under the CPTPP. The suspension would mean that these provisions will not be implemented for the time being, until all CPTPP member countries agreed to uplift this suspension.

“The Tokyo meeting has agreed to add two more suspensions into the list – making it a total of 22 suspensions. One of them was on the additional flexibilities for Malaysia in the oil and gas sector as described above – after the relentless pursuit and consistent fight put forth by our negotiating team on this matter. Another one was on the market access for Brunei’s coal industry,” he said.

The English text of the agreement has been finalised and it will be released upon the completion and verification of the same text in French and Spanish, expected within the next few weeks. – Bernama


Australian PM hails new TPP, Canada comes on board

SYDNEY: Prime Minister Malcolm Turnbull today hailed the revival of the Trans Pacific Partnership (TPP) as a boon for jobs, but critics questioned how much Australia would really gain from a deal that excludes the US.

After Canada yesterday agreed to rejoin 10 other nations in resurrecting the trade pact, Turnbull termed the deal a multi-billion-dollar trade windfall for Australia.

“It is a big deal,” the prime minister told reporters. “A big trade deal at a time when many people said it couldn't be done, after the United States pulled out, after President Trump was elected.”

“We are firmly of the view that a free and open Indo-Pacific, open markets, free trade, the rule of law, encouraging investment and trade through our region is manifestly in our national interest and in the interests of all of the countries in the region.”

In addition to Australia, the pact now known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership includes Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

The agreement, expected to be formally ratified in Chile in March, will incorporate all commitments from the original TPP, except for a limited number of provisions suspended temporarily and some remaining issues to be finalised.

It means new bilateral agreements for Canberra with Canada and Mexico, as well as increased access for many Australian agricultural products to member states. The deal seeks to remove 98% of tariffs within the trade bloc.

The TPP looked doomed last year after President Donald Trump withdrew the US, dismaying allies but fulfilling an election pledge.

Australia's opposition Labor party said the new pact had lost its shine since the US withdrawal and the government had failed to specify how the country would benefit from it.

“This is a very different agreement because America's not in it,” shadow minister for trade Jason Clare told Sky News. “The original agreement involving the United States involved around 40% of the global economy. Without the US it's about 13%.”

Patricia Ranald, a senior research fellow at the University of Sydney, cautioned that a revived deal would deliver less than the government boasts.

Access to Canada and Mexico would be moderately beneficial but trade agreements were already in place with the other countries, “so the market access gains are at the margin”, she said.

Ranald has been critical of the pact, which she says allows corporations to bypass national courts and does too little to protect labour rights and migrant workers.

“I think the TPP has become a symbol of open markets, against the Trump unilateralism, but if you actually look at what is in the TPP it does reinforce monopolies which are the opposite of open markets,” she said.

“It really is about global corporations having a set of rules that suits them.”

Canada said on Tuesday it would sign onto the revised 11-member Asia-Pacific trade pact after pushing to secure a better deal, underpinning a government drive
to diversify exports amid doubts over North America Free Trade Agreement.

Prime Minister Justin Trudeau told reporters at the World Economic Forum in Davos that he helped push for an improved deal, showing how important the trade file has become for him personally.

But a major labour union and a group representing auto parts manufacturers said the deal would cause job losses.

Trade officials signed off on a final text earlier in the day after a meeting in Tokyo to overcome challenges such as Canada's insistence on protection of its cultural industries.

The deal agreed to the suspension of intellectual property and investment dispute provisions that had been a concern. Trade Minister Francois-Philippe Champagne said the deal would also grant full access to Japan's auto market for the first time.

“Diversification is key for Canada … for us opening up markets is essential,” he told reporters in Toronto.

A previous round of talks last November ended in disarray after Canada objected to parts of the proposed text and Trudeau was lambasted for missing a key meeting with Japan's prime minister on how to secure a deal.

The breakthrough came on the same day that negotiators started the sixth and penultimate round of talks on Nafta, which US President Donald Trump has repeatedly threatened to abandon.

The Unifor private sector union and Canada's Automotive Parts Manufacturers Association complained Champagne had not warned them at meetings earlier this week that the deal was about to be agreed.

Unifor head Jerry Dias said that at a time when Canada is facing US demands at Nafta to increase the North American content of autos from the current 62.5%, the new TPP deal would allow the duty-free import of parts which contained a maximum of 35% of components from member nations.

This would allow the greater use of cheaper parts from Asian nations, causing havoc in the domestic industry, he added.

“The simple reality is what happened with the TPP completely undermined what's happening in Montreal over Nafta,” said Dias. “They have just cut the legs off of the entire Canadian negotiating team here on Nafta,” he told reporters.

The Canadian Agri-Food Trade Alliance welcomed the deal, saying it would help boost food exports to Japan. – Agencies


Unifi to increase subscriber base to 1.5m this year

KUALA LUMPUR: Telekom Malaysia Bhd’s Unifi brand, which consolidated its business units under one roof, is targeting 1.5 million broadband subscribers this year, from both the household and business space.

As part of its convergence plan, Unifi has put all of its products – namely its broadband service Unifi home, Unifi mobile which is a rebranded version of Webe, Unifi TV (formerly HyppTV) and its public wifi service Unifi wifi – under a single brand.

Speaking to reporters at the launching ceremony of the refreshed Unifi brand, executive vice-president Imri Mokhtar said he was hopeful that with the launch of new services under the refreshed brand the group would be able to reach its target of expanding its broadband service subscriber base by 500,000. It’s subscribers base for the segment stood at 1 million as at June 2017.

Meanwhile, for its mobile unit, the group also launched a new service known as #BEBAS, which is a hybrid of prepaid and postpaid that enables customers to select their data and usage requirements with no credit deadline.

With this service, Unifi is looking to attract about 8-10% of its broadband services subscriber base as potential customers for Unifi mobile.

“We believe that we have to do what is best for the customer and earnings and revenue will come,” Imri said when asked if the absence of a payment deadline would impact the group’s earnings.

It is also looking to take its public wifi offerings up several notches by increasing its coverage from the current 10,000 locations to 100,000 by year end, with hotels, transportation hubs and shopping malls being target locations.

The group will also be mobilising a team to scout for new customers at potential areas and facilitate broadband installations and service activation.

The initiatives are expected to be financed through TM’s capital expenditure allocation for this year.

On the government’s agenda of doubling broadband speed at half price, Imri said the group is working together with regulators.

“We are working together and supporting the government’s agenda for digital connectivity. One of the programmes we are doing this year is to double the speed for the same price. We are working together with the ministry as well as regulators for its implementation,” he said.

The government announced in the Budget 2017 speech that fixed line service providers will have to double their broadband speed offering at the same price.


Unifi targets 1.5m new subscribers this year

KUALA LUMPUR: Telekom Malaysia Bhd’s Unifi brand, which consolidated its business units under one roof, is targeting 1.5 million new broadband subscribers this year, from both the household and business space.

As part of its convergence plan, Unifi has put all of its products – namely its broadband service Unifi home, Unifi mobile which is a rebranded version of Webe, Unifi TV (formerly HyppTV) and its public wifi service Unifi wifi – under a single brand.

Speaking to reporters at the launching ceremony of the refreshed Unifi brand, executive vice-president Imri Mokhtar said he was hopeful that with the launch of new services under the refreshed brand the group would be able to reach its target of expanding its broadband service subscriber base by 1.5 million. It’s subscribers base for the segment stood at 1 million as at June 2017.

Meanwhile, for its mobile unit, the group also launched a new service known as #BEBAS, which is a hybrid of prepaid and postpaid that enables customers to select their data and usage requirements with no credit deadline.

With this service, Unifi is looking to attract about 8-10% of its broadband services subscriber base as potential customers for Unifi mobile.

“We believe that we have to do what is best for the customer and earnings and revenue will come,” Imri said when asked if the absence of a payment deadline would impact the group’s earnings.

It is also looking to take its public wifi offerings up several notches by increasing its coverage from the current 10,000 locations to 100,000 by year end, with hotels, transportation hubs and shopping malls being target locations.

The group will also be mobilising a team to scout for new customers at potential areas and facilitate broadband installations and service activation.

The initiatives are expected to be financed through TM’s capital expenditure allocation for this year.

On the government’s agenda of doubling broadband speed at half price, Imri said the group is working together with regulators.

“We are working together and supporting the government’s agenda for digital connectivity. One of the programmes we are doing this year is to double the speed for the same price. We are working together with the ministry as well as regulators for its implementation,” he said.

The government announced in the Budget 2017 speech that fixed line service providers will have to double their broadband speed offering at the same price.


Boustead Plantations proposes to sell land in Penang for RM136m

PETALING JAYA: Boustead Plantations Bhd (BPB) proposes to sell three pieces of its plantation land in Penang measuring a total 138.89ha for RM136.04 million.

It entered into sale and purchase agreements with Sunrich Conquest Sdn Bhd for a parcel of freehold land measuring 82.84ha for RM81.14 million cash, and with Titanium Greenview Sdn Bhd for two parcels of freehold land measuring 0.20ha and 55.85ha respectively for a total of RM54.90 million cash.

The 138.89ha land forms part of Malakoff Estate. Following the completion of the sale of part of the Malakoff Estate measuring 677.78ha on Sept 26, 2017 and this proposed sale, BPB will continue to own and operate its plantation business on the remaining 562.33ha of Malakoff Estate.

The sale consideration represents a premium of about RM5 million or 3.82% over the market value of RM131 million accorded by the valuer.

“The strategic location of the land provides an opportunity for BPB to realise the capital appreciation of the land by disposing them at a substantial premium over the net book value of the land. BPB will realise an estimated gain of about RM115.9 million upon completion of the proposed sale, representing an upfront gain of about RM834,000 per hectare, which will increase BPB’s shareholders value by about 7 sen per BPB share,” BPB said in a stock exchange filing.

Given the strategic location of the land, BPB is able to unlock and realise higher return through the proposed sale. This gives BPB the opportunity to use the realised funds for repayment of bank borrowings for the purpose of strategic expansion in new plantation land banks.

Upon completion of the proposed sale, BPB is expected to realise an estimated net gain of about RM115.90 million, which translates into a gain of about 7 sen per BPB share.

The exercise is expected to be completed by the third quarter of 2018.


BPB proposes to sell land in Penang for RM136m

PETALING JAYA: Boustead Plantations Bhd (BPB) proposes to sell three pieces of its plantation land in Penang measuring a total 138.89ha for RM136.04 million.

It entered into sale and purchase agreements with Sunrich Conquest Sdn Bhd for a parcel of freehold land measuring 82.84ha for RM81.14 million cash, and with Titanium Greenview Sdn Bhd for two parcels of freehold land measuring 0.20ha and 55.85ha respectively for a total of RM54.90 million cash.

The 138.89ha land forms part of Malakoff Estate. Following the completion of the sale of part of the Malakoff Estate measuring 677.78ha on Sept 26, 2017 and this proposed sale, BPB will continue to own and operate its plantation business on the remaining 562.33ha of Malakoff Estate.

The sale consideration represents a premium of about RM5 million or 3.82% over the market value of RM131 million accorded by the valuer.

“The strategic location of the land provides an opportunity for BPB to realise the capital appreciation of the land by disposing them at a substantial premium over the net book value of the land. BPB will realise an estimated gain of about RM115.9 million upon completion of the proposed sale, representing an upfront gain of about RM834,000 per hectare, which will increase BPB’s shareholders value by about 7 sen per BPB share,” BPB said in a stock exchange filing.

Given the strategic location of the land, BPB is able to unlock and realise higher return through the proposed sale. This gives BPB the opportunity to use the realised funds for repayment of bank borrowings for the purpose of strategic expansion in new plantation land banks.

Upon completion of the proposed sale, BPB is expected to realise an estimated net gain of about RM115.90 million, which translates into a gain of about 7 sen per BPB share.

The exercise is expected to be completed by the third quarter of 2018.


RM25m to increase F&N Dairies’ capacity

PETALING JAYA: Fraser & Neave Holdings Bhd (F&N) has allocated RM25 million in capital expenditure for its F&N Dairies manufacturing plant in Pulau Indah, Selangor, to enable five million cases in additional annual capacity.

F&N said in a statement, this is expected to accelerate the group’s exports business towards achieving its sales target of RM500 million from Malaysia ahead of the 2020 deadline.

Similarly, F&N said it is also looking at targeted capacity expansion in its plants in Rojana and Pakchong, Thailand.

Together with its Thai operation, F&N said it is targeting RM800 million in total exports by 2020 while firmly establishing exports as a sustainable third pillar alongside contributions from the Malaysian and Thai business operations.

On the strengthening ringgit and Thai Baht against the US dollar, its CEO Lim Yew Hoe said the impact should be slightly favourable even though it presents a challenge to the export team.

Going forward, Lim said he expects the economic landscape in Malaysia and Thailand will continue to be challenging albeit with higher gross domestic product (GDP) forecasts and a strengthening currency.

Nevertheless, Lim said he is hopeful that the new products to be launched would provide new growth engines.

During its AGM today, shareholders has approved payment of a final single tier dividend of 30.5 sen per share for the financial year Sep 30, 2017, which is payable to shareholders on Feb 9, 2018. The entitlement date of the dividend is Jan 29, 2018.