Three firms shortlisted for Khazanah’s Pos stake

PETALING JAYA: Khazanah Nasional Bhd and its advisers yesterday shortlisted three companies for the sale of its32.21% stake in Pos Malaysia Bhd. According to sources, the three companies are DRB-HICOM (M) Bhd, Nationwide Express Courier Services Bhd and Scomi Group Bhd. The shortlisted parties were invited yesterday to present their proposals to an independent panel evaluating the deal. Khazanah
had said in the past that this panel would comprise five professionals
from the public and private sector “with extensive postal and corporate
experience”. Sources said one of the panel members is Tan Sri Md Nor Yusof, a director and chairman of the executive committee of Khazanah and a former Securities Commission chairman. Khazanah has hired CIMB Bank and an international consulting firm to manage the divestment of its Pos Malaysia stake. Most
bidders have had to provide a standby letter of credit to the tune of
RM15mil. The bidding process has given bidders the opportunity to meet
Pos Malaysia's key management. It has been suggested that
successful candidates to buy Khazanah's stake in Pos Malaysia should not
eventually load the postal company with huge debts or influence it to
pay unreasonably high dividends. Ideally, the party looking to
buy Khazanah's 32.21% stake, which has a market value of close to
RM590mil based on yesterday's closing price of RM3.41, should be able to
raise that amount of money on its own, without having to rely on Pos
Malaysia's balance sheet. The new shareholder should, in fact, be
looking to invest Pos Malaysia's cashflows into the latter's growth
plans. Pos Malaysia has a healthy balance sheet, being in a net
cash position and owning a lot of real estates. Insiders also say that
the divestment of the Pos Malayia stake will be completed by April 12,
the date of Invest Malaysia 2011. For its financial year ended
Dec 31, 2010, Pos Malaysia recorded a 12.46% increase in revenue to
RM1.01bil while net profit decreased 11.01% to RM67.11mil.
(thestar)

drb 2.33 (+17) nationwide 0.835 (+17.5) scomi 0.33 (+1.5)

hmm..scomi hasn't move much

If DRB gets it, the price will be moving upwards again towards rm 3.00

budgee wrote:If DRB gets it, the price will be moving upwards again towards rm 3.00

drb more likely candidate 2 get posM,

got bank mualamat,
vw deal
msia defence contract,
pekan 2 b vw regional export center 2013...

...'Ideally, the party looking to
buy Khazanah's 32.21% stake, which has a market value of close to
RM590mil based on yesterday's closing price of RM3.41, should be able to
raise that amount of money on its own, without having to rely on Pos
Malaysia's balance sheet. The new shareholder should, in fact, be
looking to invest Pos Malaysia's cashflows into the latter's growth
plans"...

Does Pos Malaysia's future lie in banking?

KUALA LUMPUR: Pos Malaysia Bhd is back in the limelight, with its
share price rallying after an announcement of a bumper dividend of 17.5
sen per share two weeks ago.
Besides the buzz about the recent hefty dividend payout, the question
on everyone’s lips is who Khazanah Nasional Bhd will sell its 32.21%
equity stake in Pos Malaysia to. The
stake had been put up for sale about a year ago. Based on last
Friday’s closing price of RM3.58, the block of shares is worth RM619
million.
So far, Khazanah has not officially revealed the names of the parties
that have submitted their bids for the stake in Pos Malaysia. The Edge
Financial Daily has learnt that parties that have submitted the bids
include DRB-Hicom Bhd, Scomi Group Bhd, a joint venture of Amanah Raya
and Malaysia Pacific Corp Bhd, and Nationwide Express Courier Services
Bhd.
Tan Sri Syed Mokhtar al-Bukhary is the name most often
mentioned in connection with the equity stake in Pos Malaysia, which
provides the country’s postal services and owns 697 post offices,
outstripping any commercial bank in terms of branch network. DRB-Hicom
Bhd is said to be the vehicle for Syed Mokhtar to acquire the stake.
There is even talk the tycoon is mulling a merger between Pos
Malaysia and Bank Muamalat Malaysia Bhd, in which DRB-Hicom owns a 70%
stake, in order expand his Islamic banking business. However, there is
no official confirmation on the matter. DRB-Hicom bought over the stake
in Bank Muamalat from Syed Mokhtar some years back. Khazanah holds the
remaining 30% stake in the Islamic banking group, according to the
bank’s website.
The traditional “snail mail” business of postal groups around the
world, not just Pos Malaysia, is fast becoming obsolete in the age of
email and instant messaging.
Analysts agree there is a need for Pos
Malaysia to diversify its service portfolio. The provision of banking
services through its branch network is probably one way to do so. Some
postal groups, Singapore Post for example, have apparently done so.
Already Pos Malaysia has strategic tie-ups with Malayan Banking Bhd
(Maybank) and RHB Bank Bhd, in a move to diversify its earnings base.
The group’s partnership with Maybank will provide selected
over-the-counter banking services, such as cash deposits and withdrawals
for savings account holders, in addition to loan repayments in over 400
post offices by year-end. Its tie-up with RHB Bank involves the
provision of the shared banking services in over 300 post offices,
eventually leading to the opening of “Easy by RHB” kiosks at selected
post offices.
Analysts say with Pos already offering selected banking services, the
notion that it may eventually offer more of such services or partner
more banks is not an unusual one.
“Although Pos Malaysia offers a
limited range of banking services on behalf of Maybank and RHB Bank, we
do not see this as a hindrance to Bank Muamalat Malaysia Bhd
establishing a meaningful strategic tie-up with Pos Malaysia since it
could still provide a wide array of banking services and function like
an actual bank, with its own staff,’ OSK Research says in a report.
Some analysts reckon that by offering a wider variety of services,
such as Islamic banking, the postal group may achieve economies of
scale. Forming partnerships for the provision of banking services would
be a win-win deal for Pos Malaysia and banks. The postal group will earn
more fees, while the banks can leverage on a wider branch network to
reach more customers, especially in rural areas.
However, some quarters note that a partnership with banks is totally different from the ownership of a bank.
Should Pos Malaysia acquire a stake in a bank, perhaps the most
relevant question would be the pricing of the asset and how it affects
minority shareholders. There is nothing wrong with a postal group buying
into a bank. Indeed, Deutsche Post owns Postbank in Germany. The German
postal group is doing well and is considered one of the postal groups
that has successfully transformed itself.
But will there be earnings enhancement or dilution? Will such a deal,
if it happens to be a related-party transaction, be at arm’s length and
at a fair price? These are the issues that concern Pos Malaysia’s
minority shareholders.
Apart from its the extensive branch network and ballooning cash pile,
analysts say the other hidden values of Pos Malaysia are in its large
landbank and property assets.
Should the government relax the
restrictions on the use of land that the Federal Land Commission (FLC)
has given to Pos Malaysia, the redevelopment of some of the land could
probably earn the group hefty gains.
Currently, the FLC owns a sizable chunk of the land where Pos
Malaysia’s post offices are located. Pos Malaysia has a leasing
arrangement with FLC, hence it is bound by the restriction that the land
can only be utilised for the provision of postal services.
“The rationalisation of Pos Malaysia’s land, for example the tract
near KL Sentral which is in a prime location, would be good,” says a
fund manager. OSK Research points out in a recent note that some
sizeable plots of land owned by Pos Malaysia are in Bukit Raja,
Brickfields, Bangi and Salak Tinggi.
“However, all this is dependent on the (amendment of) the Postal Land
Act,” an analyst comments, adding that, thus far, there have been no
updates on the proposed amendment to the Act which would allow
additional non-post-related services to be carried out on the land.
Analysts concur that, if the amendments are revised favourably in terms
of land use, Pos Malaysia’s valuation would increase.
Again, this raises the question of how the incoming shareholder(s) leverage the landbank, should the Act be amended.
Asset stripping is probably the last thing that minority shareholders want to see happen in Pos Malaysia.
And if the Act is to be eventually amended, would it be better for
Khazanah to delay the sale of Pos Malaysia, so that the additional
land-valuation gains accrue to the government, rather than a private
entity?
Khazanah’s managing director Tan Sri Azman Mokhtar has stressed that
the government investment arm wants a shareholder who is “fit and
proper” and should have “the right entrepreneurial spirit given the
postal transformation trends globally”.
Pos Malaysia’s minority shareholders certainly hope that Azman will walk the talk.

drb got bank mualamat... [You must be registered and logged in to see this image.]

Definitely DRB this time :)

shd hv sapu some pos bb during mkt cheap sale nw 2 late gone so high...

Khazanah board to meet this week on Pos


KUALA LUMPUR: Khazanah Nasional Bhd's nine-member board is
scheduled to meet this week to finalise bids made for Pos Malaysia Bhd,
people familiar with the matter said.

Khazanah is selling its
32.21 per cent stake in Pos Malaysia, the country's sole national postal
service company, and had shortlisted and interviewed as many as three
bidders last week.

It is understood that the three bidders are
DRB-HICOM Bhd, Nationwide Express Courier Services Bhd and a joint
venture between Amanahraya Bhd and loss-making Malaysia Pacific Corp
Bhd.

Nationwide, meanwhile, said it could not comment on the timeline of the decision due to confidentiality agreements signed.




"But from what we gather from the media reports, the decision will be made soon," a company spokesperson said.

Two other companies had also placed bids for Pos Malaysia, namely Scomi
Group Bhd and Tricubes Bhd. Most of the bidders had placed a RM15
million deposit, as part of the bidding requirement.

A Khazanah
spokesman declined to comment on the number of bids being brought to the
board or the timeline for the board meeting to take place.

Pos Malaysia shares closed 4 sen lower at RM3.63 yesterday, valuing Khazanah's stake in the firm at some RM600 million.

Business Times understands that DRB-HICOM's bid has been pre-selected
for approval, but ultimately it is up to the Khazanah board to decide if
it wants to sell to the conglomorate.

DRB-HICOM's bid values Pos Malaysia somewhere between 2.5 times and three times over its book value.

Pos Malaysia's book value per share stood at RM1.54 as at end-December
2010, but the real book value may be a bit lower now, given its plans to
pay a 17.5 sen dividend.

It is understood that DRB-HICOM will be looking to inject Bank Muamalat Malaysia Bhd into the postal firm if it won the bid.

Ironically, apart from DRB-HICOM's 70 per cent stake in the Islamic bank, Khazanah has a 30 per cent stake in Muamalat.

For the 15 months ended March 31 2010, Bank Muamalat posted a pre-tax
profit of RM142 million versus RM44.1 million in the corresponding
period in 2008, Its total assets balloned to RM16.7 billion from RM14.4
billion previouly.

Bank Muamalat's financial year 2010 tracked
15 months instead of 12 months, because it was changing its year-end to
March 31 from December 31 to coincide with parent DRB-HICOM's.


Pos Malaysia, meanwhile, registered sales of RM1.01 billion, alongside a
net profit of RM67.11 million for the year ended December 31 2010. The
postal firm had total debts of about RM40 million as of last year.

DRB down amid talk of bagging 32% of Pos Malaysia

KUALA LUMPUR: Diversified group DRB Hicom Bhd shares slipped 19 sen or
7.7% to end trading at RM2.27 yesterday, with some 21 million shares
changing hands.

The sharp fall in the company’s shares yesterday
came amid speculation it had won the bid to buy a 32% stake in Pos
Malaysia Bhd from state-controlled investment arm Khazanah Nasional Bhd.
The announcement is expected today at the Invest Malaysia 2011 forum.

The
reason for the downward spiral in the company’s shares is unknown.
Other than the reported bid for Pos, in March this year DRB had
announced winning a RM7.55 billion defence contract to design, develop,
manufacture, commission, supply and deliver 257 armoured wheeled
vehicles to the government over a seven-year period.

For the nine
months ended December 2010, DRB posted a net profit of RM400.07 million
or 20.69 sen a share, on the back of RM4.81 billion in revenue.

DRB is 55.92% controlled by low-key businessman Tan Sri Syed Mokhtar Al-Bukhary.

Winner of Khazanah stake in Pos identified


Khazanah Nasional Bhd, the government's investment arm, has decided on the potential buyer for its 32.21 per cent stake
in postal service provider, Pos Malaysia Bhd.

"We
already have a winner in mind," said Khazanah managing director Tan Sri
Azman Mokhtar, adding that there were 50 potential buyers.

He however declined to narrow the identity of the "winner" but said the names would be submitted to the board later this month.

Among
the criteria set for the bidders are ability to provide good premium
and unlock Pos Malaysia's values, he told reporters on the sidelines of
Invest Malaysia 2011 here today.





News reports and research houses had suggested that the three
shortlisted bidders were DRB-HICOM Bhd, Nationwide Express Courier
Services and a Amanah REIT-Malaysia Pacific Corp joint venture, with
offers ranging between RM3.38 and RM4.62 per share. The other two
bidders were Scomi Bhd and Tricubes Bhd.

Asked on the impact of
the new Postal Bill, which has yet to be tabled in Parliament, on the
deal, Azman said various issues have been factored in, including
consultation with industry players.

"Hence, the Bill is not expected to be entirely a surprise," he said.

The
Bill is expected to touch on crucial issues in Pos Malaysia, including
the government's golden share and rights over some of the real estates
owned by Pos Malaysia. -- Bernama

DRB-HICOM wins Pos stake

Kuala Lumpur: Tan Sri Syed Mokhtar Al Bukhary's
DRB-HICOM Bhd has won a bid to take over national postal company Pos
Malaysia Bhd, people familiar with the matter said yesterday.

[You must be registered and logged in to see this image.]

Business Times understands that DRB-HICOM will sign an agreement with
Khazanah Nasional Bhd early next week to buy the latter's Pos Malaysia
stake.

DRB-HICOM sees Pos Malaysia as a crucial fit to expand
its Islamic banking operation, now parked under Bank Muamalat Malaysia
Bhd.

Khazanah, the government investment arm, currently holds
30 per cent of Bank Muamalat, while the remaining 70 per cent is owned
by DRB-HICOM.

It is understood that DRB-HICOM is buying Pos
Malaysia from Khazanah for about RM3.60 a share. The latter currently
owns 32.21 per cent of Pos Malaysia.
The deal will value Khazanah's Pos Malaysia stake at about RM623 million.

Last year, Khazanah had called an open bidding process for suitors of Pos Malaysia.

About a week ago, two companies - DRB-HICOM and Scomi Group Bhd - were shortlisted by the Khazanah board.

It is understood that the DRB-HICOM bid was the most attractive option
for Pos Malaysia because of the conglomerate's plan to eventually inject
Bank Muamalat, the country's second full-fledged Islamic bank, into it.

This, in turn, will provide Bank Muamalat with a much wider network nationwide.

There are currently some 692 post offices and 355 mini post offices, according to Pos Malaysia's website.

Bank Muamalat, meanwhile, has 46 branches.

For the 15 months ended March 31 2010, Bank Muamalat posted a pre-tax
profit of RM142 million versus RM44.1 million in the corresponding
period in 2008,

Its total assets rose to RM16.7 billion from RM14.4 billion previously.

Bank Muamalat's 2010 financial year tracked 15 months instead of 12
months because it was changing its year-end to March 31 from December 31
to coincide with its parent's financial year.

No notification on Pos stake win yet: DRB

DRB-Hicom Bhd said it hasn’t received notification from Khazanah
Nasional Bhd as to whether the company has been chosen to buy the
Malaysian fund’s 32.2 percent stake in Pos Malaysia Bhd.

An announcement will be made as and when necessary, DRB said in an exchange filing today. - Bloomberg

hlk wrote:No notification on Pos stake win yet: DRB

DRB-Hicom Bhd said it hasn’t received notification from Khazanah
Nasional Bhd as to whether the company has been chosen to buy the
Malaysian fund’s 32.2 percent stake in Pos Malaysia Bhd.

An announcement will be made as and when necessary, DRB said in an exchange filing today. - Bloomberg

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