Axiata weighs bid for Saudi Telecom’s Axis Indonesia

axiata-and-axisAxiata Group Bhd, Malaysia’s largest mobile-phone operator, is evaluating a bid for PT Axis Telekom Indonesia, three people with knowledge of the matter said.

Any offer for Axis would be made by Axiata’s Indonesian unit, PT XL Axiata, the people said, asking not to be identified as the information is private. Purchasing the Indonesian carrier would give XL Axiata the mobile-phone frequencies it needs to expand in Southeast Asia’s most crowded wireless market, one person said.

Axis, majority owned by Saudi Telecom Co, is valued at about US$1 billion (RM3.02 billion) including debt, according to an estimate from Saudi Fransi Capital. Malaysia’s Maxis Communications Bhd also holds a stake in the company.

Ten operators compete for subscribers in Indonesia’s mobile market, the second-highest number in Asia after India, in what XL Axiata on May 1 called an “unsustainable situation.” Buying spectrum would allow XL Axiata to add services and coverage areas after the company this month reported first-quarter profit slumped by more than half to 315.5 billion rupiah (RM96.6 million) from a year earlier.

Hasnul Suhaimi

Hasnul Suhaimi

“There’s no information that I can share at this point in time,” XL Axiata president director Hasnul Suhaimi said in a text message response to questions from Bloomberg. A spokeswoman for Kuala Lumpur-based Axiata declined to comment, while representatives of Saudi Telecom, Axis and Maxis Communications weren’t immediately available.

Consolidation benefits

Any purchase of Axis would require approval from the Indonesian government, which holds stakes in the two largest telecom operators — PT Telekomunikasi Indonesia and PT Indosat — one person said.

XL Axiata, with 46 million subscribers, would be “happy to play a role” in consolidation of Indonesia’s mobile telecom industry, Suhaimi said on a May 1 conference call with investors.

“Ultimately, it might become not even attractive to continue investing,” unless the industry structure improves, he said, according to a transcript of the call.

Indonesia’s three major operators, including XL Axiata, would benefit from acquisitions as eased competition would allow them to raise prices, Riaz Hyder, an analyst at Macquarie Group Ltd, wrote in a report last month.

china-stock-market-exchangeXL Axiata fell 1% to 5,150 rupiahs as of 2:10pm in Jakarta today, taking this year’s decline in the shares to to 9.7%. The stock has underperformed the Jakarta Composite Index’s 21% gain this year, and trades at a lower price- to-earnings multiple than Telekomunikasi Indonesia and Indosat, data compiled by Bloomberg show.

Saudi Telecom owns 84% of Axis, while Maxis holds the remainder. Saudi Telecom’s stake in Axis is valued at US$880 million, Saudi Fransi Capital analyst Roy Cherry said in February. Saudi Telecom’s chief executive officer Khaled Al Ghuniem quit the parent company in March after less than a year in the post.

- BLOOMBERG

 

Boustead posts lower pre-tax profit in 1Q

Boustead Holdings Bhd’s pre-tax profit for the first quarter (1Q) ended March 31, 2013 declined to RM174.9 million from the RM222.9 million recorded in the same quarter last year.

Revenue, however, rose to RM2.531 billion from RM2.358 billion previously, the company said in a filing to Bursa Malaysia today.

In a separate statement, Boustead said the Group’s results were strongly influenced by lower crude palm oil (CPO) prices which impacted the plantation division

“These results were achieved on the back of an increased turnover of RM2.5 billion compared with RM2.4 billion recorded in 1Q last year.

“The division was severely impacted by depressed commodity prices and a decline in crop production for the period under review, registering a profit of RM31 million compared with RM92 million for the same period in 2012,” it said.

Boustead noted the property division was the major contributor to performance, delivering a profit of RM33 million.

Going forward, Deputy Chairman/Group Managing Director Lodin Wok Kamaruddin said Boustead will heighten its efforts and seek out new opportunities while focusing on improving organic growth.

“We are confident that our strong fundamentals in terms of diversified income streams and viable businesses, will allow us to accomplish this and deliver a profitable year,” he added.

- BERNAMA

Yes launches world’s first Samsung 4G Chromebook

01YTL Corporation’s Yes launched the world’s first Samsung 4G Chromebook today. The device, exclusive to Yes, heralds the next generation of computers.

“The Samsung 4G Chromebook will be a first device for many people. It is affordable, secure and always connected to the Internet. No one will be left out of the Internet age” said YTL Communications chief executive officer Wing K Lee when launching the Samsung 4G Chromebook in partnership with Samsung and Google.

The Samsung Chromebook functions entirely on the concept of cloud computing by utilising Google Chrome as its platform. In Malaysia, Yes will power the Chromebook’s Internet connection through its nationwide 4G network, providing a high-speed mobile internet connectivity of up to 20Mbps.

yes-4g-launch-5“The Samsung 4G Chromebook is the perfect device to use on our network…it brings the power of computing to everyone,” said Francis Yeoh, YTL Group’s managing director. He added that he was proud of the capacity and range of Yes’ 4G network and believed that it would usher in a new era of cloud computing in Malaysia.

This is the first time the Chromebook is being introduced in an emerging economy like Malaysia, previously only being available in developed markets. In those markets, the Chromebook has been the best selling laptop since its launch, according to Caesar Sengupta, product management director at Chrome OS, Google.

Lee added that in Malaysia, Yes has enhanced the product by putting in their 4G network. He explained that the Chromebook powered by Yes 4G was superior because Chromebook users in other countries were reliant solely on a WiFi connection, while users in Malaysia will have access to both a WiFi and Yes 4G network allowing them to be connected to the Internet while on the go.

yes-4g-launch-2Sundar Pichai, the Senior Vice President for Android, Chrome and Google Apps at Google said he was excited to see the Samsung 4G Chromebook being introduced in Malaysia. He added that he was impressed at the pace of 4G connectivity being rolled out across the country, saying that Malaysia was a model for other countries around the world.

The Samsung 4G Chromebook is among the lightest laptops on the market, weighing around 1.1kilograms with a width of 17.5 millimeters. It has a seven hour battery life and runs on a Samsung Exynos 5 Dual Core Processor.

It is currently retailing at RM988 with a 24-month RM88 postpaid plan which comes with a monthly data quota of 3.5GB. While the device alone costs RM1,299. The Chromebook is available at It is also available at Yes Stores nationwide and online.

1BestariNet Yes ID holders at can purchase a discounted package of RM988, with a 24-months RM69 plan which comes with a monthly 3,5GB data quota. Purchases can be made at the FrogStore online or at Bestari roadshows nationwide.

Petronas Chemicals allocates RM3bil for 2013 capex

Petronas Chemicals Group Bhd (PCG) has allocated RM3 billion for capital expenditure this year, of which, two-thirds would be utilised for the development of the Sabah Ammonia Urea (SAMUR) project.

PCG Chairman Wan Zulkiflee Wan Ariffin said the world-scale greenfield project was a very important milestone for the company as it would strengthen its urea market position in South East Asia.

The company is currently the fifth largest producer of urea in the South East Asian region with an annual production capacity of 1.4 million metric tonnes.

“We target to complete the SAMUR project by August 2015. And, after some commissioning and testing process, the plant would begin commercial operations two months thereafter.

“Currently, the completion rate is about more than 30%. Underground construction is now taking place,” he told reporters after PCG’s annual general meeting today.

Wan Zulkiflee Wan Ariffin

Wan Zulkiflee Wan Ariffin

Wan Zulkiflee said the SAMUR project would add another 1.2 million metric tonnes of urea output per annum, bringing the group’s total urea productionvto about 2.6 million metric tonnes, annually.

With the additional capacity, he said PCG expected earnings growth for its fertiliser and methanol business segment which currently contributed about 25% to the entity’s revenue and profit.

Without divulging growth projections, Wan Zulkiflee said the growth would  be mainly based on global urea prices.

“The current price is US$380 per metric tonne. So, we (will) move along the price and market demand.

“The percentage contribution growth is not expected to be very significant, as we are growing the entire business pie, not only the fertiliser business,” he added.

Other than the RM3 billion capex for this year, Wan Zulkiflee said there was still about RM3 billion in unused proceeds from the company’s 2010 initial public offering (IPO) exercise.

From the RM12.89 billion raised from the IPO, he said the RM3 billion would be used to fund growth projects as part of the obligations set by Bursa Malaysia.

“We still have until 2015 to use it (the excess fund). We certainly have plans. Maybe we would also use it for the SAMUR project,” he added.

chemical-testingMoving forward, Wan Zulkiflee said PCG would continue to optimise its product portfolio, in addition to maximising margins through active molecule management, and riotising the production of higher value products.

He also said pursuant to the company’s decision to discontinue its vinyl business, operations have ceased at the Vinyl Chloride Monomer and Polyvinyl Chloride (PVC) plants in Kertih, Terengganu, effective January.

The company was also in the process of divesting its interest in a PVC plant in Vietnam.

In a related development, Wan Zulkiflee said the RM1.5 billion joint-venture between PCG and Germany’s BASF to expand their operations in Gebeng, Kuantan, was expected to secure the final investment decision by year-end.

The project, to manufacture products for the global flavour and fragrance industry, would be developed into an integrated aroma ingredients project.

ringgit-malaysia-generic

“With this investment, we aim to meet the globally growing demand from customers in the flavor and fragrance industry, especially in Asia Pacific,” he added.

BASF and Petronas Chemicals said last month that the heart of the complex would comprise a plant for citral and precursor plants and, that they would also invest in downstream production for aroma ingredients including a new world-scale plant for L-menthol and a plant for citronellol.

Production will be developed in phases with the first plant expected to operational in 2016, creating some 110 new jobs.

- BERNAMA

EXIM Bank helping companies venture abroad

The Export-Import Bank of Malaysia (EXIM Bank) is playing its role in exploring international markets to support local companies in their cross-border ventures, said Deputy Finance Minister Ahmad Maslan.

He said the bank, which disbursed RM3.1 billion last year, received an average of between 150 and 200 applications for funding per year.

“This was a three-fold jump as opposed to RM1.2 billion disbursed in 2011 and was in line with the bank’s mandated role to focus on cross-border markets,” he said before witnessing the signing of a memorandum of collaborative arrangement (MOCA) between EXIM Bank, The Multimedia Development Corporation (MDeC) and the Construction Industry Development Board (CIDB) here today.

The MOCA would serve as a platform for CIDB and MDeC to share their respective knowledge and expertise with EXIM Bank to facilitate Malaysian construction and ICT players in their cross-border ventures.

Ahmad Maslan said EXIM Bank’s expertise and experience in relation to international market involvement provided the right equation for both CIDB and MDeC, especially in guiding “export-ready” entities, to better equip themselves prior to venturing into any unchartered territories.

“In return, the sharing of technical expertise available from CIDB and MDeC will allow the bank to assess any related application with indepth understanding,” he added.

- BERNAMA