KWAP nampaknya berjudi lagi dengan membeli saham CAHB, kali ini di pasaran terbuka. Analis berpendapat ia akan rugi RM44 juta diatas kertas dengan tindakkannya itu.

[(RM6.95 - RM5.15) X 24.4 = 43.9 juta] dari pelaburan RM169.4 juta

Sebelum ini ia membeli 273.9 juta saham time dotCom pada harga RM3.30 sesaham. Sekarang harga saham itu cuma RM1.99 sahaja. Rugi atas kertas sebanyak RM358.8 juta.

[(RM3.30 - RM1.99) x 273.9 = 358.8 juta] dari pelaburan RM904 juta.

Bulan Disember lepas KWAP membeli 70 juta saham MAS dari Agensi Pelaburan Brunai dengan harga RM4 sesaham. Kini saham MAS sekitar RM2.60. Maknanya ia rugi atas kertas RM98 juta

[(RM4.00 - RM2.6) x 70 = RM98 juta] dari pelaburan RM280 juta.

Jika dicampur semuanya - ia rugi RM500 juta di atas kertas begitu sahaja...... alangkah malangnya.

[RM43.9 + RM358.8 + RM98 = RM500.7 juta]

Dan yang menariknya Daim sudahpun bercuti sebelum bersara..... kerana sudah beres mengerjakannya.

-Eddie Toh-

-TJr Kapal Berita-

The Business Times, Singapore
19th April 2001

M'sian pension fund bets on stocks again

Kumpulan Wang buys 24.4m CAHB shares; paper loss on CAHB alone could be RM44m

By Eddie Toh

KUMPULAN Wang Amanah Pencen (Kwap), apparently unchastened after coming under fire for its costly bet on the initial public offering of Time dotCom last month, has made another substantial acquisition in the Malaysian stock market.

Kwap declared yesterday that it bought 24.4 million shares in Commerce Asset-Holding Berhad (CAHB), the owner of the second largest bank in the country, late last month.

The government agency is now a substantial shareholder with a 2.07 per cent stake in its maiden purchase of the parent of Bumiputra-Commerce Bank.

Kwap said it acquired the shares on the open market.

However, analysts said Kwap could have purchased some of the shares from substantial shareholders as only 1.2 million CAHB shares changed hands in the market on the transaction date of March 22. Furthermore, only a handful of owners own more than 2 per cent of CAHB.

According to its annual report, the major CAHB shareholders are the Ministry of Finance (16.75 per cent), Khazanah Nasional (15.03 per cent), New Straits Times Press (12.85 per cent), Renong Bhd (12.16 per cent), the Employees Provident Fund (9.3 per cent), Sanwa Bank (4.56 per cent), and Capital Group (2.84 per cent).

The seller or sellers of the shares have yet to disclose their disposals.

But the sellers are not likely to be fellow government agencies like Khazanah or the EPF, which have been mopping up shares of CAHB and other Malaysian companies in the last few months.

It is still not known if the shares had belonged to Renong or NSTP. The two companies have been trying to unload their CAHB stakes in the last two years to pare down their debts.

A dealer said the shares could have come from Capital Group. The US fund manager has disposed of seven million CAHB shares in the last four months, but still owns about 26 million CAHB shares.

Kwap, which manages the country's pension funds for 800,000 retirees, is likely to be sitting on a huge paper loss of almost RM44 million (S$20.9 million) from its investment in CAHB.

The pension fund did not disclose the purchase price, but the shares were worth RM169.4 million based on the market price of RM6.95 on the acquisition date.

CAHB's share price has since eased to RM5.15 yesterday, valuing the Kwap investment at RM125.5 million.

Kwap's recent aggressive streak in the Malaysian bourse has raised eyebrows though.

Last month, Kwap, which comes under the office of Finance Minister Daim Zainuddin, disclosed that it coughed up RM904 million in cash to take up 273.9 million unwanted Time dotCom shares at RM3.30 apiece following its dismal IPO.

Time dotCom, which is part of the Renong stable, closed at RM1.99 yesterday.

And in December, Kwap bought Brunei Investment Agency's entire 70 million shares in national carrier Malaysian Airline System at RM4 apiece. MAS closed at RM2.60 yesterday. Kwap is now sitting on an estimated whopping paper loss of RM500 million from its recent investments in Time dotCom, MAS and CAHB.

http://business-times.asia1.com.sg

The Business Times, Singapore
19th April 2001

Will Halim Saad take UEM private?

Move will be less costly than exercising put option

By Diana Oon Abdullah

THE delayed sale of assets by Renong to its sister company United Engineers Malaysia (UEM) last week has sparked speculation that Renong boss Halim Saad may take UEM private in a bid to avoid exercising an expensive put option that will cost him more than RM3 billion (S$1.4 billion).

At RM2.86, UEM's share price has more than halved in the last six months, giving rise to market talk that conditions might be ripe for Mr Halim to attempt to make a general offer for UEM.

Officially, Mr Halim is a controlling shareholder of UEM, holding 38 per cent through Renong.

'In reality he probably controls close to 50 per cent, including holdings by friendly parties,' said an analyst with a local broking house.

A general offer for UEM, whose market capitalisation is currently about RM2.3 billion, would only require Mr Halim to come up with RM1.2 billion, plus whatever premium he needs to offer to induce minority shareholders to sell.

Taking UEM private would offer a neat solution to one of Mr Halim's biggest problems. It would relieve him of the obligation to buy back UEM's 32.3% stake in Renong, under an option granted in Feb last year.

The option itself arose from a controversial deal where UEM bought Renong shares from unnamed shareholders in late 1997. Mr Halim gave a personal undertaking to buy back the shares in order to placate UEM's minority shareholders who questioned the deal.

UEM has only collected RM100 million from Mr Halim since the option matured two months ago.

He is due to make two other payments of RM100 million each on July 14 and Dec 14, with the bulk of the price, over RM3 billion including interest, due on May 14 next year.

'Whatever the eventual price Mr Halim might pay to take UEM private, he will effectively be getting a discount of RM3 billion or more, as the option will not be exercised,' said a market observer.

But the plan may yet remain stillborn.

First, it is questionable if Mr Halim and associates could raise more than RM1.2 billion to take UEM private under current bearish market conditions. After all, Mr Halim has had to delay the second instalment of RM100 million under the new put option agreement.

Indeed Mr Halim seemed to say as much yesterday. 'The logic is there,' he told AFX-Asia news service, saying that it would be cheaper for him to take UEM private than to honour the put option.

'But where to find the money?' he added.

Second, it's still unclear what an ideal general offer price should be. A general offer at current market price may not find a high acceptance rate while a higher price tag may make it more expensive than exercising the put option.

Ultimately, the final price would depend on how UEM's prized cash-generating assets - the North-South Highway (Plus) and to a lesser extent the Middle Ring Road (Elite) - are valued.

Some argue that it would be hard to find the means to pay for the offer if it is based on the net present value of future earnings of Plus and Elite, 'which could be RM20 billion for Plus alone', according to one analyst.

After taking away RM9 billion for Plus' debt, 'we're still looking at values of RM10 to RM11 billion', said an industry watcher. 'But strictly from a corporate finance point of view, UEM is a prime candidate for privatisation through a leveraged buyout, because it is close to Plus' cash flows,' he added.

Third, Mr Halim will still have to juggle UEM's heaps of debts although he will nullify his personal obligation if UEM is turned into his private vehicle.

UEM has close to RM11 billion in debt, over RM8 billion of which are bonds issued by Plus and another RM2 billion in bonds issued by Elite.

If Mr Halim is indeed going to take UEM private, his success will depend on how desperate the minority shareholders are to sell.

Institutional investors have been giving the stock, formerly a favoured infrastructure counter, a wide berth in the last two years as the group increased borrowings to help solve Renong's debt problems.

Having solved the debt problems of another Renong company, Time Engineering, through the listing of Time dotCom earlier this year, Mr Halim recently took over the helm at Prolink Development Sdn Bhd, the Renong subsidiary which owns land in Gelang Patah at Malaysia's end of the Second Link.

Taking UEM private would therefore buy Mr Halim time to restructure UEM's debts and to work on listing Plus in friendlier market conditions. With plans already afoot to list Elite via a reverse takeover of Kedah Cement, UEM would be no more than a listed shell holding company if Plus is listed in the future.

Also, UEM only agreed to buy Renong's assets in order to gain control over pledged assets to ease its own debt restructuring, so it appears that both the privatisation of UEM and the assets sales are means to the same end.

http://business-times.asia1.com.sg