FBMKLCI 1556.42 DJ-279.65 CRUDE OIL100.13 RM2.9770

The potential merger of either Malayan Banking Bhd (Maybank) or CIMB Group Holdings Bhd with RHB Capital Bhd would bring the new enlarged entity not too far behind some of the largest banks in the region. The top regional banks in Asean include three Singapore banks DBS Group Holdings Ltd, Oversea-Chinese Banking Corp Ltd (OCBC) and United Overseas Bank Ltd (UOB) with market capitalisation of US$27.7bil, US$25.7bil and US$24.5bil respectively. While in terms of asset size, the Singapore banks remain at the top, a Maybank-RHB Cap merger could overtake DBS Group in terms of combined market capitalisation with US$28.8bil. The potential merger of CIMB-RHB, on the other hand, would see a combined market capitalisation of US$27.3bil, just marginally below DBS but would overtake both OCBC and UOB. In terms of asset size, DBS, OCBC and UOB stand at US$238bil, US$198.4bil and US$178.8bil respectively.

Following the dismissal of Primus (M) Sdn Bhd's petition against the sale of EON Capital Bhd (EON Cap) to Hong Leong Bank Bhd (HLB), Primus now has to pay RM1.9mil in court costs. High Court Judicial Commissioner Varghese George Varughese ordered Primus to pay the sum to the 13 respondents in its suit EON Cap and nine of its board members, and three entities controlled by two of those board members.

Sarawak Energy Bhd (SEB), which will have the rights to the Bakun dam's power at a rate of 6.25 sen per kwh, has a firm utilisation rate of 50% from its four customers. The electricity from the Bakun dam which is priced at 6.25 sen/kwh with an annual hike of 1.5% under a power purchase agreement (PPA) between Sarawak Hidro Sdn Bhd and Syarikat Sesco Bhd confirmed a StarBiz report yesterday. StarBiz quoted sources saying the rate represented the cheapest tariff in Asian history but would be escalating at 1.5% per annum for 30 years.

SapuraCrest Petroleum Bhd (SapCrest) has signed an agreement with Real Mild Sdn Bhd and Labuan Shipyard and Engineering Sdn Bhd (LSE) for the subscription of 25 million new shares in LSE. The shares, according to SapCrest in a filing with Bursa Malaysia yesterday represented a 50% stake of the enlarged share capital of LSE.

Oil and gas services provider Dialog Group Bhd has entered into a joint-venture agreement with Vopak Terminal Pengerang BV, a unit of the Royal Vopak group, for the development of an independent deepwater petroleum terminal at Pengerang, Johor worth RM5bil. The company told Bursa Malaysia yesterday that both parties had set up a joint-venture company - Pengerang Terminals Sdn Bhd - in which Dialog would hold a 51% stake and Royal Vopak the remainder.

Water concessionaire Puncak Niaga Holdings Bhd is expected to register a loss this financial year following the adoption of a new accounting treatment that requires certain charges to be capitalised as intangible assets and amortised. Managing director Datuk Hashim Mahfar said in a statement yesterday that the IC Interpretation 12-Service Concession Arrangements, which were retrospective, had also resulted in a drop in shareholders' funds from RM1.5bil to RM35.6mil. However, Puncak Niaga has obtained a conditional waiver from being categorised a PN17 company until the announcement of its second-quarter results for the period ending June 30, 2012. (Under Bursa Malaysia rules, that would have been the case if a company's shareholders' funds fell below RM40mil).

Benalec expects to realise a net gain of RM34.93 million from the completion of separate agreements its units have entered for the disposal of land and joint venture for a mixed property development. Benalec on June 1 said its subsidiaries Sentosacove Development Sdn Bhd and Orientalcove Realty Sdn Bhd had entered into a sale and purchase agreement and joint venture agreement with Vista Selesa Development Sdn Bhd, respectively.

CBIP is selling its entire equity interests in Sachiew PLANTATION []s Sdn Bhd and Empressa (M) Sdn Bhd for a total of RM268.06 million. Sachiew is principally involved in the cultivation of oil palm and production of crude palm oil and palm kernel, while Empressa engages in the cultivation of oil palm and the operation of a palm oil mill. CBIP said the gross proceeds of RM268.06 million from the disposal would be utilised for its working capital including for financing receivables, inventories, and repayment of bank borrowings.

Bina Puri’s 80%-indirect owned subsidiary PT Megapower Makmur has received two contracts from PT PLN (PERSERO) to operate power plants in Indonesia.

FBMKLCI 1525.28 DJ-130.78 CRUDE OIL 97.90 RM 2.9955

US stocks tumbled on Monday with European debt fears and easing Chinese growth giving investors jitters.
The Dow Jones Industrial Average of blue-chip stocks closed down 130.78 points (1.05 per cent) at 12,381.26. S&P's downgrade of Italian sovereign debt fed fears of a spreading eurozone crisis, while slowing Chinese manufacturing figures were a new sign of a slowdown in the world's number-two economy.
"Centre stage belonged to global uneasiness surrounding the euro-area debt crisis, after Standard & Poor's downgraded its outlook for Italy, Fitch lowered its outlook on Belgium, debt restructuring in Greece remained uncertain, and Spain's ruling party was trounced in regional elections over the weekend," said analysts at Charles Schwab.
 

Bursa Malaysia yesterday queried enterprise software solutions provider Ingenuity Solutions Bhd over the unusual market activity pertaining to the sharp fall of its share price and the high volume of its shares changing hands. The ACE Market-listed shares shed 4.5 sen yesterday to close at 13 sen yesterday, and topped the list of most actively traded shares with volume reaching 59.4 million shares.

Puncak Niaga Holdings Bhd, through its wholly-owned subsidiary Puncak Oil & Gas Sdn Bhd (POG), had entered into two separate sale and purchase agreements with Global International Vessels Ltd (GIVL) for the acquisition of equity interests in two of the latter’s subsidiaries. Puncak Niaga said the acquisition of the 40% equity interests in Global Offshore (Malaysia) Sdn Bhd (GOM) and KGL Ltd, respectively, would involve a total cash consideration of US$23.6mil (RM70.8mil). This would be made up of 300,000 GOM shares costing US$8.4mil and 80,000 KGL shares costing US$15.2mil.

PUNCAK NIAGA HOLDINGS BHD and its partner Quality Concrete Holdings Bhd signed a contract for a RM667.32 million rural water supply project in Sarawak. Puncak said the 40:60 Konsortium Puncak Niaga Holdings Bhd-Quality Concrete had signed the contract to supply rural water from 2010 to 2012. The completion period is Dec 31, 2012. PBA’s net profit surged 105% to RM11.03 million from RM5.37 million a year ago mainly due to the improved sale of water revenue from trade consumers. Its revenue rose 15.3% to RM56.31 million from RM48.85 million while earnings per share were 3.33 sen compared with 1.62 sen.

Bursa Malaysia Securities has uplifted Ibraco Bhd from the Practice Note 17 classification with effect from Tuesday, May 24. With the completion of the regularisation plan, the company has regularised its financial condition and no longer triggered any of the criteria under PN17 of the Main Market Listing Requirements

Bursa Securities had also approved Ibraco’s waiver application to comply with the requirement to record a net profit in two consecutive quarterly results immediately upon the implementation of the regularisation plan.

Crane manufacturer FAVELLE FAVCO BHD  reported a 13.5% increase in earnings to RM3.86 million in the first quarter ended March 31 from RM3.40 million a year ago mainly due to higher sales. Revenue rose 13.6% to RM85.18 million from RM74.95 million while earnings per share were 2.18 sen versus 1.97 sen. It had cash and cash equivalents of RM103.03 million as at March 31. As at May 19, 2011, outstanding order book of the group is RM496.4 million of which majority is from oil and gas cranes for the offshore oil and gas exploration and production activities.

MITRAJAYA HOLDINGS BHD  has secured a RM46.40 million contract to build an eight-story private hospital in Rawang. It accepted the letter of award from Rawang Specialist Hospital Sdn Bhd for the contract.

MAA Holdings Bhd, a Malaysian insurer, rose 1.6 per cent in Kuala Lumpur trading after saying its first-quarter profit more than tripled. The stock climbed to RM1.28 at 9:10 a.m. local time, set for its biggest gain since May 19.

FBMKLCI 1528.01  DJ:+10.29 CRUDE OIL: 87.90 RM: 3.09

Syabas sues Selangor govt for RM471.6m

 Puncak Niaga Holdings’ subsidiary, Syarikat Bekalan Air Selangor SB (Syabas), has sued the Selangor state government for RM471.64m. Puncak Niaga claimed that the RM471.64m was due to it as compensation for the period between 1 January 2009 and 31 December 2009 in return for not raising water tariffs

HSL wins RM67m Sarawak road job

 Hock Seng Lee (HSL) has been awarded the RM67.3m Tuie/Supa/Manggut Road construction project in Betong, Sarawak by Adiqa Engineering SB. The scope of works included earthworks, road, drainage and other related works. The project is due to be completed by May 2013. (Starbiz)

MAS signs up maintenance support for B737-800s

 Malaysia Airlines Engineering and Maintenance (MAS E&M) and Air France Industries and KLM Engineering and Maintenance (AFI KLM E&M) have signed a 10-year component support contract for 35 if the carrier’s fleet of B737-800s, with an option for a further 20 aircraft. The 737 Component Services Programme was operated in partnership with Boeing.  The contracts also provide AFI KLM E&M to create a component spares pool in the company’s facility to exclusively support the airline’s B737-800s. Simultaneously, a regional component pool would be set up in Kuala Lumpur to provide services to MAS and other customers. (Starbiz)

Khazanah  to let fly stake in MAHB for RM404m

Khazanah Nasional, Malaysia’s sovereign wealth fund, plans to sell a second tranche of shares in Malaysia Airports Holdings (MAHB) for as much as RM404m. According to a wire report yesterday, the government owned investment arm plans to place out 66m shares, or a 6% stake, at an indicative price range of RM6-RM6.12. The report said Khazanah which sold a 7.7% stake in MAHB in March, has an upside option to sell an additional 22m shares. This latest sale is being managed by Nomura Holdings Inc, HSBC Holdings plc and RHB Capital. (MalaysianReserve)