Hot Stock Sarawak Cable rises 10% on planned acquisitions, dividend

by **Cals** Tue 17 Jun 2014, 01:16

Hot Stock Sarawak Cable rises 10% on planned acquisitions, dividend

Business & Markets 2014

Written by Ahmad Naqib Idris Adzman Shah of theedgemalaysia.com

Monday, 16 June 2014 15:49

KUALA LUMPUR (June 16): Sarawak Cable Bhd (SCB) rose as much as 9.7% after it announced the proposed acquisition of industrial cable producers Universal Cable (M) Bhd and Leader Cable Industry Bhd for RM210 million.

At 3.16pm, SCB was traded at RM1.53, up nine sen or 6.3% with some 42.2 million shares done.

The stock, which traded among top gainers on the exchange, had earlier risen as much as 14 sen or 9.7% to RM1.58.

An analyst with AmResearch Sdn Bhd said SCB's acquisition announcement could explain the rise in its share price.

“If the deal goes through, Sarawak Cable will be the cable company with the biggest market share in Malaysia,” he told theedgemalaysia.com.

SCB announced today it had accepted a conditional offer from HNG Capital Sdn Bhd for SCB to buy 100% stakes in Universal Cable and Leader Cable. Datuk Seri H’ng Bok San, who is the controlling shareholder and director of HNG, is a non-independent non-executive director of SCB.

Meanwhile, Bernama reported that Sarawak Cable had approved its first and final single-tier dividend of 1.5 sen a share for financial year 2013 compared with 2.5 sen in 2012.

Based on the enlarged share capital of 279,450,000 ordinary shares of RM0.50 each, the company's total dividend payout for financial year 2013 amounted to RM4.2 million despite the company's lower profit for the same financial year, said its Chairman Datuk Seri Mahmud Abu Bekir Taib.

On prospects, Mahmud said the current three main business segments -- manufacture of power cables and conductors, steel fabricated products and contract revenue -- remained the group's core business.

He said the substantial increase in the group's order book to RM756 million as at March 31, 2014 was expected to generate good revenue and profits in financial years 2014 and 2015.