KLSE BUY & SELL AND NEWS 30.7.2009

Boustead Holdings Bhd (BOUS MK, Hold, TP: RM3.50) is looking to raise up to RM1.3bn through a rights issue anddivestment of its non-core assets. Boustead wants to use the proceeds to reduce its debt as well as for expansion purposes in key operations, namely shipyard, property and plantations. Shareholders have approved the two-for-five rights issue that could raise up to RM729.16m. Major shareholder, Lembaga Tabung Angkatan Tentera Malaysia with a 59.55% stake, has agreed to subscribe all of its portion of the rights shares. Boustead is looking to raise another RM500m to RM600m from the disposal of non core assets that include 17,000ha of plantation land in Indonesia and an 80% stake in BH Insurance (M) Bhd. (The Malaysian Reserve)

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CIMB Thai bank, 94% owned by Bumiputra Commerce Holdings Bhd (BCHB MK, Hold, TP: RM8.80), hopes its recent restructuring and an expected recovery in Thailand’s economy will help it return to net profit next year, earlier than expected. “A return to net profit this year, that’s hard to predict,” president Subhak Siwaraksa said. “Even though we are
already showing operating profits, the key variable is provisioning charges, which depend on economic conditions.” CIMB Thai had no plans to expand through mergers or acquisitions, he added. (Financial Daily)

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The possibility of a merger between AirAsia (AIRA MK, Buy, TP: RM1.90) and its sister company AirAsia X, if it were to materialise at all, is unlikely to happen anytime soon, Datuk Tony Fernandes and Azran Osman Rani were quoted saying despite the deal being favourable in their opinion. Besides, AirAsia would have to deal with strengthening its balance sheet first
before it could consider any merger exercise with AirAsia X, and it was in the midst of raising capital. (Financial Daily)

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AirAsia X is proceeding with its expansion plans, including the launching of two new routes, to Chengdu, China and a city in the Middle East this year. The company plans to increase flight capacity this year to current routes by 50% to the Gol Coast in Australia, by 40% to Taipei, Taiwan and by 20% to Hangzhou, China. Also this year, either Melbourne or Perth
Australia may see a boost in capacity from one flight daily to having 2 flights on four days weekly. He said the new flight to the Middle East would start before Hari Raya Haji. (Financial Daily)

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Alliance Financial Group Bhd (AFGB) is likely to pay lower dividend for the current financial year in anticipation of a weaker performance due to the challenging economic setting, said chairman Datuk Oh Chong Peng. He said that the group had passed on every sen that it received from Alliance Banking Group to shareholders and that it paid 6.5 sen per share last year, but expected it to be lower this year as profits are likely to be lower. AFGB is the parent company of Alliance Bank Malaysia Bhd as well as Alliance Investment Bank Bhd, Alliance Investment Management Bhd and Alliance Islamic Bank Bhd.
(StarBiz)

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Alliance Financial Group Bhd’s banking arm, Alliance Bank Malaysia Bhd (ABMB) will be relooking at its product offerings and focusing on selling less risky products in view of the uncertain times. ABMB group CEO Datuk Bridget Lai said there was a need to focus on less risky products that gave the bank the revenues it was looking for in the financial year ending March 31, 2010. On the bank’s loans growth in FY10, Lai said that ABMB remained cautiously optimistic about its prospects and would continue to grow its loans portfolio at a slower rate, most likely in the lower teens, in terms of percentage growth. (Financial Daily)

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Lion Diversified Holdings Bhd said its wholly-owned unit Well Morning Ltd has entered into a conditional sale and purchase agreement with Lion Asiapac Management consultancy (Shanghai) Co Ltd (LAPS). The agreement is for the disposal of the right to invest in the remaining 30% registered capital of Changshu Lion Enterprise Co Ltd to LAPS for a nominal cash consideration of 1 renmimbi (51 sen). LAPS is a subsidiary of Lion Asiapac Ltd (LAP) while Changshu Lion is a
property development company in Changshu city, Jiangsu Province in China. (StarBiz)

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Carlsberg Brewery Malaysia Bhd (CBMB) expects Carlsberg Singapore Pte Ltd (CSPL) to contribute about 30% to its net profit in the financial year ending Dec 31, 2010 pursuant to its proposal to acquire the latter. CBMB also expects to resume its dividend payout at previous levels after surprising the market with its lower dividend early this year. CBMB managing director Soren Holm Jensen said preliminary estimates showed CBMB’s net profit for2010 to increase to RM113m from RM76m in 2008, on the assumption that the proposal to acquire CSPL was approved by minor shareholders. (Financial Daily)

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KPJ healthcare Bhd’s unit Kumpulan Perubatan (Johor) Sdn Bhd (KPJSB) is buying the Bandar Baru Klang Medical Centre Building from Greenbelt View Sdn Bhd RM38m cash. KPJ said the proposed acquisition was in line with its objective to increase its network of hospitals to locations where private healthcare was in demand. The proposed acquisition, which was
expected to be completed by year-end would be financed via internally generated funds. (Financial Daily)
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Mudajaya Corp Bhd has been awarded a RM75.38m contract to build a hospital in Pahang. The project was awarded by Takdzim PMG Sdn Bhd on July 27. The project is expected to be completed by Jan 31, 2012. (Financial Daily)

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Bank Negara Malaysia kept the overnight policy rate unchanged at 2% at the Monetary Policy Committee meeting yesterday, saying there were signs the global and local economies were stabilising. “Conditions in the domestic economy have also showed signs of stabilising in the 2Q, with several indicators such as the industrial production index and retrenchment recording a slower pace of decline,” it said in a statement. (Financial Daily)