Naim Cendera - The New Sarawak Construction King

The construction industry has been contracting drastically over the last two years, and governments projects are running dry. Contractors can be forgiven for getting paranoid and may have to look into possible overseas action.

It is expected that the third quarter and fourth quarter economic results will fare no better than the second quarter of the year, and thus we should see far greater contraction.

In this weak economic environment, there stands out a company in Sarawak who has the ability to sustain their business, and are confidently projecting to generate 30% growth over the next three years.

The industry is ushering a new king of construction - Naim Cendera Sdn Bhd, a wholly owned subsidiary of Naim Cendera Holding Bhd (NAIM) - reported that they had been recently awarded three contracts by the Federal and State government of Sarawak for infrastructure and building projects worth RM507.5 million.

The projects awarded include the bridge over Batang Belingian (contract value of RM35 million), the new Sarawak State Assembly building (DUN) worth RM296 million, and the upgrading of the Julau-Sibu Road which is RM176.5 million.

Naim is expecting another award for the Pasukan Gerakan Am project at Batu Kawa in Kuching which is expected to be about RM313 million and has also received a Letter of Intent (LOI) for the proposed Bengoh Dam which is also worth hundreds of millions.
In addition, Naim also is developing a 100-acre mixed development project at Sungei Kuap in Kuching and has other property development projects in Miri, Kuching, etc.

Currently, Naim’s value of confirmed order book is more than RM1.252 billion which may be sufficient to sustain its business earnings for the next three to four years and this book order is expected to be enhanced in the next few months.

Naim’s chairman, Datuk Abdul Hamed Sepawi is confident that the group is capable to maintain a cumulative average growth rate of more than 30% over the next three years.

Naim is poised to be the next kingpin of the construction industry surpassing former greats such as Gamuda, MMC, Roadbuilders, Ho Hup, Suncon, MTD, Mitrajaya, Binapuri and IJM.

Robert Kuok Exits Pelangi

PERMODALAN Nasional Bhd (PNB) expects to complete its acquisition of Pelangi Bhd, a property developer, by next week. PNB president and chief executive officer Tan Sri Hamad Kama Piah said the company had sought a three-week extension for the mandatory general offer (MGO) from July 18.

"We have been given an extension until August 26 for the minority shareholders to accept the offer. We have to wait until then before we can conclude the MGO," he said.

"This was the third extension as some (minority shareholders) wanted time for them to decide (whether to accept the offer)," Hamad Kama Piah told newsmen.

Meanwhile, Bursa Malaysia Bhd said in a statement that it has delisted Pelangi, effective yesterday. Hamad Kama Piah explained that as PNB had acquired more than 90 per cent of Pelangi, Bursa Malaysia had to delist the company according to the listing requirements. Hamad Kama Piah also said an exco has been set up to chart Pelangi's future direction and programmes. "We have decided to let the Pelangi board members determine the direction they want to take and we will monitor their progress. We have appointed exco members to chart and oversee suitable programmes.“ Acquisitions of stakes in companies are very much in PNB's plans, he said, adding that PNB will buy and sell when the opportunity arises. "As a fund manager, we are strategically positioning ourselves in certain areas.“ On the current market sentiment, he said the trend is improving and he believed that the fundamentals are there.

On May 26, 2005, Business Times reported that PNB had made a mandatory takeover offer for the 50.74% stake it does not already own in property developwe Pelangi Bhd for RM 283.74 million. PNB offered to pay in cash for Pelangi’s 369.49 million shares at 77 sen per share. In its financial year ended March 31, 2005, Pelangi reported a net profit of RM32.17 million on the back of RM168 million in revenue.

COMMENTS:

Is PNB Buying into a sunset institution? Pelangi, is a household brand name in housing development, particularly in Johor Bahru, and is reknown for it's quality houses and strategic positionings, and locations. It is generally believed that Pelangi's houses has a 10% premium over market prices.

In fact Pelangi were the one of the pioneer property developer that offers largescale residential housing estates that are 8m wide (24ft width). Those houses, you can see them parking up to four cars within their fenced compound. Most Malaysian residential houses are 22ft or 20ft wide. In Kuala Lumpur and Selangor, you can even see houses of 18ft width. In fact, those buyers will feel claustrophobic.

With the exit of Robert Kuok, Pelangi announced the resignation of Frank Goon Swee Keong as the company’s MD and Datuk Musa Ayub Saad, Datuk Md Zahari Md Zin and Huang Yan Teo as directors.

The success story of Pelangi is synonym with Frank Goon. It was Frank's dream and vision that had brought Pelangi to what it is today, although the credit goes to Robert Kuok. Frank is a brunt and straight man, who is unassuming; he does not accept second best. He is the driver of the system and adopts a power culture. Frank is known to be one who will give stupendous reward to his people who are high performers.

Over the last few years, the property business in Johor Bahru is getting more competitive and less lucrative. Literally, Pelangi had ride on the good market time, a time where competition is not as stiff as of today. Johor Bahru is seeing a mushrooming of housing estates and the infiltration of myraid of "immigrant developers" coming from Kuala Lumpur and Singapore. Profit margins are coming down drastically, tho' still profitable. That seemed to be the objective reason for the readiness of Kuok to exit at a "ripe" time.

PNB will be acquiring an asset in the sunset period. It will pose a great challenge to the acquirer to emulate the previous success story of Frank Goon and his acolyte. Good luck to PNB; and it surely will be better luck to Frank Goon and Kuok Group.

Samy Toll Pre-emptive Strikes

Samy Toll

SAMY CALCULATED PREEMPTIVE STRIKE

Samy: Be prepared for rise in toll charges

Works Minister Datuk Seri S. Samy Vellu said the Government had to stop the payout as it could no longer burden itself with increasing costs. “After taking many things into consideration, the Government wants to put a stop to this practice,” he said. As such, he said, the people should be prepared for an increase in toll charges.

Samy Vellu said the Government had to pay out hundreds of millions of ringgit in compensation to the concessionaires when they asked for an increase in toll charges, as provided for in their agreements. “Based on the concessionaire agreements, a toll increase cannot be avoided when the time comes,” he added.

FIRST, he agreed to terms that was North-bound; such one-sided lucrative contracts that would create instant billionaires of which investment bankers would be willing to be bed-partners to fund these projects.

NOW, we are suffocated by the toll-haze; and the directorate is coquetting empathy.

This is the best Ventriloquism you can ever watch!!!! Let dance to the tune .....