LBS Bina prep­ping ML Global for growth

> Group will po­si­tion sub­sidiary for gov­ern­ment and pri­vate con­struc­tion jobs

The Sun (Malaysia) - - MEDIA & MARKETING - BY EE ANN NEE

PE­TAL­ING JAYA: LBS Bina Group Bhd, which is ex­pected to an­nounce a cor­po­rate ex­er­cise to­day, is groom­ing its 51.1%-owned listed sub­sidiary ML Global Bhd as a ve­hi­cle to se­cure gov­ern­ment and pri­vate con­struc­tion jobs, hav­ing placed se­nior staff at ML Global to as­sist in set­ting up the di­rec­tion and work­flow of the con­struc­tion com­pany.

Trad­ing in LBS’s and ML Global’s se­cu­ri­ties has been sus­pended for three mar­ket days from last Fri­day to to­day pend­ing a ma­te­rial an­nounce­ment.

LBS man­ag­ing direc­tor Tan Sri Lim Hock San ( pix), who is also ML Global man­ag­ing direc­tor, said ML Global will be adopt­ing the same business model as its par­ent LBS, such as get­ting more jobs to boost profit, build rep­u­ta­tion of the com­pany and to de­liver projects within the stip­u­lated time frame.

“Once we make up the direc­tive and poli­cies, ev­ery­thing will be smooth as the staff will be able fol­low the in­struc­tions,” he told Sun­Biz in an in­ter­view re­cently. “Be­sides be­ing a growth com­pany, we want to put ML Global as a div­i­dend-yield com­pany. We will work hard to make it one of the good stocks,” Lim added. LBS sees good prospects in ML Global’s fu­ture po­si­tion­ing, given that there are many con­tract op­por­tu­ni­ties from the gov­ern­ment. Lim said it had bought into ML Global es­pe­cially for this, even though the prop­erty de­vel­oper has an ex­ist­ing in­ter­nal con­struc­tion arm, MITC En­gi­neer­ing Sdn Bhd, in­volved in the build­ing of high­rise and landed res­i­den­tial and in­dus­trial prop­er­ties for LBS as well as ex­ter­nal par­ties. “We’ve been ap­proached by sev­eral gov­ern­ment agen­cies to ten­der for jobs and we feel that we should have an in­de­pen­dent con­struc­tion arm to get the jobs, so that it is in a bet­ter po­si­tion to clinch deals. The gov­ern­ment has a lot more jobs com­ing up so we want a share of the cake too.”

Even­tu­ally a few of LBS’s con­struc­tion jobs may go to ML Global, Lim said, sub­ject to a fair pric­ing.

He said when ML Global is prof­itable, it will think of com­ing up with a div­i­dend pol­icy.

“This is what we want to plan for ML Global but it will take one to three years, de­pend­ing on how fast it grows. If ML Global ex­pands fast, we may raise money from the mar­ket, em­bark on a cor­po­rate ex­er­cise or of­fer ML Global to in­sti­tu­tional in­vestors. We will plan.”

Re­call that LBS emerged as a sub­stan­tial share­holder of ML Global on July 24, 2014 with a stake of 21.92%, fol­low­ing LBS’s par­tic­i­pa­tion in ML Global’s place­ment ex­er­cise. ML Global’s PN17 clas­si­fi­ca­tion was lifted on March 11, 2016.

LBS pro­gres­sively in­creased its stake in ML Global to 31.95% be­tween De­cem­ber 2014 and Fe­bru­ary 2016 and fur­ther upped its stake to 50.92% in April 2016, trig­ger­ing a manda­tory takeover of­fer for the re­main­ing shares of ML Global. Sub­se­quently, ML Global in July ceased the business op­er­a­tions of man­u­fac­tur­ing and trad­ing in roof tiles to fo­cus mainly on the con­struc­tion business.

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