Kumpu­lan Perangsang look­ing for more as­sets

> How­ever, com­pany still in the dark over dis­cus­sions be­tween fed­eral and Selangor gov­ern­ments on Splash


SHAH ALAM: Kumpu­lan Perangsang Selangor Bhd (KPS), which is still await­ing word on the dis­posal of its 30% stake in Syarikat Pen­geluar Air Selangor Sdn Bhd (Splash), will con­tinue its ac­qui­si­tion trail next year.

Since the dis­posal of its wa­ter as­set Kon­sor­tium Ab­bas Sdn Bhd to the Selangor gov­ern­ment for RM78.054 mil­lion late last year, KPS has been un­der­tak­ing sev­eral ac­qui­si­tions.

“For 2016, we’ve achieved our tar­get, now we’re look­ing at 2017. We’ve started our bud­get process, we should be fi­nal­is­ing it in De­cem­ber.

“By then we should know the ac­qui­si­tions that we’re look­ing for,” KPS chair­man Raja Datuk Idris Raja Ka­marudin told re­porters af­ter the group’s EGM here yes­ter­day.

He said its planned ac­qui­si­tions will not be in­dus­try spe­cific.

As at June 30, 2016, KPS’s cash and cash equiv­a­lents stood at RM44.4 mil­lion.

Its re­cent deals in­cluded the ac­qui­si­tion of a 60% stake in the li­cence holder of the King Koil mat­tress brand for US$28.8 mil­lion (RM116 mil­lion). It also ac­quired a 51% in chem­i­cals trad­ing firm Aqua-Flo Sdn Bhd for RM7.5 mil­lion and bought a 51% eq­uity in­ter­est in Smart­pipe Tech­nol­ogy Sdn Bhd, which is in­volved in the wa­ter pipe re­place­ment busi­ness, for RM5.1 mil­lion.

Fol­low­ing that, KPS share­hold­ers yes­ter­day ap­proved the proposed ac­qui­si­tion of a 71.44% stake in Cen­tury Bond Bhd for RM150.03 mil­lion or RM1.75 per share.

“We see good con­tri­bu­tion from Cen­tury Bond be­cause they’re one of the mar­ket lead­ers in this busi­ness and they’re mov­ing re­gion­ally, into Thai­land, Sin­ga­pore and In­done­sia,” Idris noted.

He ex­pects Cen­tury Bond to con­trib­ute as high as 25% to KPS’s to­tal rev­enue next year. For the first quar­ter ended June 30, 2016, Cen­tury Bond re­ported a 17.1% rise in net profit to RM3.6 mil­lion from RM3.07 mil­lion in the pre­vi­ous cor­re­spond­ing pe­riod.

KPS is re­quired to un­der­take a manda­tory gen­eral of­fer for the re­main­ing Cen­tury Bond shares that it does not own at the same of­fer price of RM1.75 apiece. KPS does not in­tend to main­tain the list­ing sta­tus of Cen­tury Bond.

As an in­vest­ment hold­ing com­pany, Idris said, KPS will bring in ex­per­tise for Cen­tury Bond’s daily op­er­a­tions.

“We bring in ex­per­tise, whether they’re in­di­vid­u­als, com­pa­nies or con­sul­tants, to help us out be­cause we’re very small, just an in­vest­ment hold­ing com­pany, so we don’t pre­tend to have the ex­per­tise in all the dif­fer­ent ar­eas.”

On the wa­ter restruc­tur­ing is­sue, Idris said they are still in the dark some weeks af­ter the time­line given for the rene­go­ti­a­tion of the master agree­ment be­tween the Selangor and fed­eral gov­ern­ments lapsed on Oct 7.

“It was sup­posed to be on Oct 7. Af­ter that we don’t know what hap­pens. It has been very quiet, noth­ing from the state and fed­eral gov­ern­ments. We’re not in a con­trol­ling po­si­tion in Splash, so it’s re­ally up to them to ne­go­ti­ate. We’ve not heard of the new dead­line,” he said.

KPS agreed to sell its 30% stake in Splash in 2015, but the deal is de­pen­dent on Ga­muda’s go-ahead. There has been no in­di­ca­tion that Ga­muda, which holds a 40% stake in Splash, will ac­cept the of­fer as Ga­muda has con­sis­tently re­it­er­ated that it will re­sult in a divest­ment loss of RM920 mil­lion.

Com­ment­ing on KPS’s 20% stake in Sprint High­way, Idris said the group does not plan to sell it for the time be­ing. “We wanted to exit, but with the tar­iff in­crease, now it is start­ing to turn the cor­ner, so why should we sell it?”

Idris says KPS has achieved its tar­get for 2016

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