MoF Inc cashes in on Prestariang

by **Cals** Fri 22 Nov 2013, 14:07

Business & Markets 2013

Written by Fatin Rasyiqah Mustaza of theedgemalaysia.com

Friday, 22 November 2013 09:58

KUALA LUMPUR: The Minister of Finance Inc (MoF Inc) has sold off shares in Prestariang Bhd, which announced a record high quarterly profit, and is purely an investment decision after it yielded some returns.
According to the company’s annual report, MoF Inc held 7.16% indirect interest in Prestariang, an information communications technology (ICT) training and certification company, through its wholly owned venture capital unit Kumpulan Modal Perdana Sdn Bhd’s (KMP). It sold some 2.27 million shares on the open market and ceased to be a substantial shareholder on Wednesday.
Prestariang’s share price soared to a record high of RM2.50 on Wednesday. The stock gained 124% year-to-date.
Prestariangs’s chairman Datuk Ramli Abbas, who is also KMP’s chairman, told reporters during the company’s third quarter (3QFY13) results briefing that like any other investor, the government-linked investment firms sold off its shares to attain returns.
“When we are in the venture capital business, what do we do? Invest money to make money,” quipped Ramli.
Dr Abu Hasan Ismail, Prestariang’s CEO explained that KMP invested in the company to add value to the company.
“The value added was tremendous to Prestariang, but the bottom line is that they are there to make money and they have reduced their position from 10% to less than 5%,”
They have done the job and it’s time for them to reap the rewards,” said Abu Hasan.
When Prestariang was listed on Bursa Malaysia, KMP, which is the subsidiary of MoF Inc, took about a 10% stake in the ICT company.
Prestariang was listed on Bursa Malaysia under the governments Skim Jejak Jaya Bumiputera.
“They came in at 10% of Prestariang at RM4 million, that’s how much they pumped in and they have made 10 times more. So they are happy. They are in the business of making money,” added Abu Hasan.
The company’s largest shareholder is Abu Hasan with a 41.38% indirect interest in Prestariang.
Prestariang has been diversifying its income stream and is set to see its venture into professional skills training in the oil and gas (O&G) sector to replicate the group’s success in the ICT sector.
The company is planning to include vocational education and training for its O&G sector through its 80% acquisition of Time Out Skills Academy Sdn Bhd which will be renamed Prestariang Academy Sdn Bhd.
Abu said the O&G sector would be the company’s growth area as it will be addressing the talent shortage in the global O&G industry by providing equipped workforce.
“We want to make sure that when we train the students, they meet the quality of the industry. We don’t go into an area just for the sake of going into it but having said that, we saw a huge opportunity in that there is a big gap in terms of what the other players are doing in this space,” he said.
Prestariang’s 3QFY13 results were an all-time high quarterly results for the company and was mainly contributed by Prestariang’s training and certification (T&C) business.
The company also realised increased contribution from the O&G sector’s T&C which is rapidly growing in size.
For its 3QFY13, the company saw its net profit rising 20.7% to RM12.33 million from RM10.21 million a year earlier. Revenue was also recorded slightly higher at RM35.53 million from RM35 million a year ago.

This article first appeared in The Edge Financial Daily, on November 22, 2013.