Sunday, March 24th, 2019

 

Securities Commission committed to facilitating sustainable financing, investment ecosystem

KUALA LUMPUR, March 24 — The Securities Commission Malaysia (SC) will continue to facilitate the development of Malaysia’s sustainable financing and investment ecosystem by leveraging on the country’s position as a leader in the Islamic…


InvestKL CEO optimistic MNCs will make a comeback

KUALA LUMPUR: InvestKL CEO Datuk Zainal Amanshah said chances are MNCs that did not realise their investments in Malaysia will make a comeback to Greater Kuala Lumpur.

“These are big companies and opportunities do arise. We are always open. When they are ready and when their plans have materialised, re-engaged in this region, then we can always talk,” said Zainal.

Meanwhile, InvestKL continues to focus on wooing more investments from other MNCs.

InvestKL is mandated to attract large global MNCs such as Fortune 500 and Forbes 2000 companies to establish their regional business, innovation and talent hubs in Greater KL, providing a gateway for companies to grow their business in Asia.

Most of the investments do materialise, as InvestKL has attracted 78 MNCs to date with approved and committed investments of RM11.7 billion, as well as the creation of 11,693 regional high-skilled jobs since 2011.

From 2011-2018, 57% or RM6.63 billion of the RM11.7 billion investments were realised. In addition, 64% or 7,516 of the 11,693 high skilled regional jobs are already on the payroll. Of these 7,516 jobs, 80% employed are Malaysians.

In 2018, InvestKL attracted 12 MNCs with approved and committed investments of RM2.3 billion, against 2017’s 12 MNCs with RM2.2 billion.


InvestKL CEO: Some MNCs’ plans fail to take off because of external business reasons

KUALA LUMPUR: While many large global multinational companies (MNCs) have successfully thrived in Greater Kuala Lumpur, some ventures have failed to take off here due to various business reasons.

According to investment promotion agency InvestKL, MNCs that did not proceed with their investments in Greater Kuala Lumpur from 2011 to 2018 include Iffco, Darden, Red Lobster, Rhodium, KBR, Anheuser-Busch InBev (AB InBev) and S&D Sucden.

These MNCs are deals that have been removed from InvestKL’s tracking as they no longer meet the requirements of quality MNC investments.

InvestKL CEO Datuk Zainal Amanshah (pix) denied that these MNCs have exited the Greater Kuala Lumpur market, but clarified that these are MNCs that have, over a period of time, expressed that their investments or joint ventures would not proceed.

“It’s not correct to say that they pulled out. They did not proceed with their investment plans,” he told SunBiz.

“Over the years, investments do not materialise because of a change in business direction. These companies have reviewed their investments and decided not to proceed because of different business plans or economic conditions, but nothing to do with Malaysia or the change in our government,” he emphasised.

An example is soft commodities trader Sucden, which was unable to source for cocoa in the Asean region and had to transfer its trading desk back to Paris.

Sucden Malaysia Ltd general manager Jasbir Singh told SunBiz that it is still operating in Malaysia but it is now a service centre keeping track of its Paris office’s logistics.

”Our role has changed because of the nature of the business and no other reasons. We are cocoa dealers and our supply chain was Indonesia but production in Indonesia is falling rapidly so our clients are now targeting African bean sourcing. This sourcing of Africa beans comes under our Paris office,” he explained.

Zainal said some MNCs were granted incentives but subsequent follow-ups revealed that there was a change in their business direction, or they have decided not to proceed with the venture.

“There is no loss in terms of revenue or tax income. It’s not like we gave them tax incentive, they took it and ran away… that’s not the case at all. These companies did not really start their operations. There is no loss per se.”

American restaurant operator Darden Restaurants Inc first signed a partnership agreement with Secret Recipe Cakes & Café Sdn Bhd in 2013 to develop and operate Darden restaurant brands of Red Lobster, Olive Garden and LongHorn Steakhouse in Malaysia. In 2014, Darden sold Red Lobster to a private equity firm and subsequently went through an entire change in its board of directors in the US.

Olive Garden Malaysia and LongHorn Steakhouse Malaysia have since ceased operations in 2018, while Red Lobster Malaysia currently has three outlets in the Klang Valley, following the closure of Red Lobster outlets in The Intermark, Mid Valley Megamall, Sunway Putra Mall and Gamuda Walk (Kota Kemuning).

AB InBev, the world’s largest brewer, is going through a shake-up in its board now following a period of steep share price declines. It was also reported to be considering an initial public offering of its Asian operations after a string of acquisitions left it with a heavy debt load.


InvestKL CEO optimistic MNCs will make a comback

KUALA LUMPUR: InvestKL CEO Datuk Zainal Amanshah said chances are MNCs that did not realise their investments in Malaysia will make a comeback to Greater Kuala Lumpur.

“These are big companies and opportunities do arise. We are always open. When they are ready and when their plans have materialised, re-engaged in this region, then we can always talk,” said Zainal.

Meanwhile, InvestKL continues to focus on wooing more investments from other MNCs.

InvestKL is mandated to attract large global MNCs such as Fortune 500 and Forbes 2000 companies to establish their regional business, innovation and talent hubs in Greater KL, providing a gateway for companies to grow their business in Asia.

Most of the investments do materialise, as InvestKL has attracted 78 MNCs to date with approved and committed investments of RM11.7 billion, as well as the creation of 11,693 regional high-skilled jobs since 2011.

From 2011-2018, 57% or RM6.63 billion of the RM11.7 billion investments were realised. In addition, 64% or 7,516 of the 11,693 high skilled regional jobs are already on the payroll. Of these 7,516 jobs, 80% employed are Malaysians.

In 2018, InvestKL attracted 12 MNCs with approved and committed investments of RM2.3 billion, against 2017’s 12 MNCs with RM2.2 billion.


Despite lawsuits, Bayer boss calls Monsanto takeover ‘a good idea’

FRANKFURT, March 24 — The boss of German chemicals giant Bayer insisted today its multi-billion dollar takeover of Monsanto was a “good idea”, despite huge legal costs piling up over its Roundup weedkiller. “The Monsanto acquisition was and…


Ringgit’s gains seen capped by external factors

PETALING JAYA: PublicInvest Research is of the view that the ringgit’s ascent against the US dollar would be held back by various external factors including the limited upside of oil prices, Brexit-related uncertainty and US-China trade negotiations.

This is despite an expected rise in demand for the ringgit on the back of the capital reorientation into the emerging market economies (EMEs).

“The negative outcome of the former (Brexit) may stoke demand for safe-haven currencies especially the dollar and the yen. The latter (trade spat) may continue to weigh on EMEs as it looks set to be prolonged given the complexity and intensity of the whole situation,” the research house said in a note last Friday.

The US President Donald Trump has said that the new higher tariff on China’s goods could stay in place for substantial period of time, long after the conclusion of the trade negotiations which could irk and push China to retaliate and hence, put further stress on global capital markets.

“All this negative sound bites are a drag on EMEs which could limit the upside of ringgit,” PublicInvest said.

It, however, expects the ringgit to be stronger at 4.00 per US dollar in 2019 versus 4.04 year-to-date. At 5pm last Friday, the local unit traded at 4.0625.

The research house said the the US Fed’s pause on rate hikes could clamp volatility and push investors to resume their searches for yield in the region, thus Malaysia’s key indicators are set to benefit from this new dynamic especially the ringgit and forex reserves.

“In fact, Malaysia could be the immediate target driven by higher real rate of return vis-a-vis the US (with the pause) thanks to our higher interest rate and benign inflation.”

The undervalued position of the ringgit is another appealing factor for Malaysia. The local unit could gain from higher risk tolerance in capital markets while forex reserves could benefit from translation gains in 2019, a reverse position against 2018, though there remains uncertainty in view of the macroeconomic risks in advanced economies.


E&O has deep value, says Affin Hwang Capital

PETALING JAYA: Affin Hwang Capital reiterated its long-term “buy” call on Eastern & Oriental Bhd (E&O) with a reduced target price of RM1.44, after a visit to the property developer’s Seri Tanjung Pinang Phase 2A (STP2A) project.

“We reduce our RNAV (revalued net asset value)/share to RM2.88 from RM3.12 previously to reflect the dilutive impact of the private placement. Based on the same 50% discount to RNAV, our target price is cut to RM1.44 from RM1.56. We see deep value in the stock as it is currently trading at price/RNAV of 0.3 times,” it said in its report.

According to Affin Hwang Capital, overall reclamation work is 73% complete at STP2A and the group is on track for full completion by end of 2019.

The reclamation work was initially slated for completion in June 2018, but was delayed to December 2019 due to complications encountered in undertaking large scale reclamation projects namely a 253-acre island and 131-acre Gurney Wharf.

The 131-acre Gurney Wharf will be handed over to the government upon completion.

“We saw a substantial portion of development land on the island has surfaced during our visit. We gather that non-financial foreign parties, including several from Singapore, are exploring joint venture opportunities with E&O to develop part of STP2A,” said Affin Hwang Capital.

Meanwhile, the entry of Tan Sri Wan Azmi Wan Hamzah as a strategic partner is expected to support E&O’s fund raising efforts to accelerate the development of STP2A.


Sime Darby property’s EV5 almost sold out on launch day

KUALA LUMPUR, March 24 — Newly-launched Elmina Valley Five (EV5), a free-hold development by Sime Darby Property Bhd, was almost sold out on its first launch day yesterday. In a statement, Sime Darby Property said buyers snapped up 98 per cent of…


Matrade’s International Sourcing Programme records RM110m potential export value at ICW 2019

KUALA LUMPUR, March 24 — Malaysia External Trade Development Corporation’s (Matrade) signature business matching programme, International Sourcing Programme, recorded over RM110 million in potential export value at International Construction…


Silterra poised to contribute to third national car project

KUALA LUMPUR, March 24 — Homegrown semiconductor company, Silterra Malaysia Sdn Bhd, has the capability to contribute positively to the development of the local automotive industry especially in the manufacture of the third national car, says…