MMC Corp looking to relist Malakoff

Group managing director says MMC, owned by businessman Tan Sri Syed Mokhtar Al Bukhary, hopes to relist Malakoff by next year.


Kuala Lumpur: With Gas Malaysia Bhd almost ready to start trading on Bursa Malaysia, MMC Corp Bhd, a construction, power and port group, is planning another initial public offering (IPO) for its other subsidiary, Malakoff Corp Bhd.

Group managing director Datuk Hasni Harun said MMC, owned by businessman Tan Sri Syed Mokhtar Al Bukhary, hoped to relist Malakoff by next year.

“We are putting in the process (to list). It will take time (for listing), probably about six months.

“It’s a bit tough (to float this year). Next year will be a more realistic target,” he said recently.

On the rationale of listing its existing subsidiaries, Hasni said MMC was focused on strengthening its business capabilities and further explore ways to unlock the value of its assets.

“As a responsible public listed company, we will continue to evaluate our investments and, obviously, if the time is right and the overall market sentiments are there, we will list those companies that are ready for listing.

“As a start, we are looking at relisting our key subsidiary, Malakoff, on the local bourse,” he said.

He said the proposed IPO for MMC’s flagship power utility company was going to be very big.

“At the time when we delisted Malakoff in May 2006, its value was estimated at RM8.8 billion.

Since then, the company has grown. But I cannot give you what is its current value as we cannot speculate.

“But I am sure that it’s going to be more than when it was delisted six years ago,” he said.

Furthermore, he said under the shareholders agreement, MMC, as a controlling shareholder, must “best endeavour” to list back (Malakoff) after six years, which is due about now.

“We are starting the process now. Whether to list of not is a different matter but we are looking at the possibility of listing. Starting the process means appointing the advisers and so on,” he explained.

He said Malakoff had grown steadily since its delisting.

It had secured several power projects, both local and abroad, such as the 1,000MW power plant in Tanjung Bin, Johor, and the recent acquisition of a 40 per cent equity in Hidd Power Company, which is Bahrain's power and water generation facility.

"We want to grow Malakoff to be a strong leader in the local market as well as make our presence felt in overseas markets.

"We are now in Algeria and Bahrain. We want certain amount of our revenue contribution to come from international business. We are looking at buying more assets and doing more joint ventures," he said, adding that the company was hoping to secure projects in the Middle East and the North African region as well as in Indonesia and Myanmar.

On a news report that Malakoff is closed to clinching investment deals in the power sector in Pakistan, Hasni clarified that Malakoff had only sent a team there to conduct a preliminary study on the viability of using wind technology to generate power.

"We are doing a preliminary study. We are checking whether we can harness wind energy there before proposing to the Pakistani government on whether or not the project is feasible.

Hasni said Malakoff was looking at increasing its overseas revenue contribution by between five per cent and 10 per cent or at least RM100 million.

On the local front, he said Malakoff, together with its consortium members comprising Petronas Power Sdn Bhd and Mitsubishi Corp, had been shortlisted, along with eight other groups and firms, to bid for the construction of a 4,500 MW combined-cycle gas turbine in Prai.

"We are in discussions with the original equipment manufacturer to compile and submit our bids (to the Energy Commission)," he said.

In March, the Energy Commission had invited the nine shortlisted bidders to purchase the request for proposal (RFP) document for the Prai power plant project and submit the RFP by July 16.

"We will submit our bid before the deadline. We will know the winner by the end of the year," he said.

Apart from this, he said Malakoff was also in discussion with MyPowerCorp for the extension of its power purchase agreement (PPA) as the first-generation PPA will expire by 2017.

"The government has two choices - build a new plant or extend the PPA. We are quite confident that we have the capability to maintain our plant in good condition."

The government recently set up MyPower to review the much-criticised PPAs between Tenaga Nasional Bhd and independent power producers (IPPs) and to make recommendations to three ministries, namely Energy, Green Technology and Water; Prime Minister's Office and Finance.

Set up about a year ago, MyPower will review and discuss the contents of the PPAs and come up with suggestions for both Tenaga Nasional and the IPPs.