Some local business news of importance 5.11.2009

It may be too early to say who will eventual top service provider for mobile data, but Norwegian firm Telenor ASA is confident its 49%- owned DiGi.COM Bhd (DIGI MK, Hold, TP: RM20.00) and the latter’s rivals – Maxis Bhd and Celcom (M) Bhd – can fend off competition from new 3G and WiMAX licensees and continue to dominate the marketplace as the window to shake market positioning has close. The 3 largest operators, Telenor group executive vice-president and
head of Asia Region, Sigve Brekke said, would continue to dominate the lucrative voice and growing mobile data market by leveraging on the huge competitive advantage they had built for themselves over the past decade. He said the big players, with their dominant market positions, would always have more money to invest and competitive advantages such as branding, an
existing customer base, and more importantly better understanding of the marketplace and customer behaviour. “We are in Asia for the long run especially after we made the decision of entering India. It is not just one more country. Asia is going to be the biggest part of Telenor with India,” Brekke said. (Financial Daily)


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With China’s President Hu Jintao visiting Malaysia next week, speculation is swirling the Malaysian government may finally seal a deal to sell 10% of planter Sime Darby Bhd (SIME MK, Hold, TP: RM8.10) to a Chinese group. It was reported that Malaysia had offered China the stake in Sime, the country’s biggest palm plantation firm by land ownership, first emerged in September, but were dismissed by Prime Minister Datuk Seri Najib Razak as pure speculation. The chatter about the agreement that could be worth about US$1.6bn (RM5.47bn) is back, with one investment bank spelling out likely
implications of the possible deal. China’s strategic backing will enhance Sime’s business in the country, where it involved in
motor and heavy equipment distribution, water treatment services, port operations, property development and palm oil sales
and marketing. The deal, if it materialises, is expected to serve the national interest of both countries as well as Sime’s which
has invested US$1bn in 6 business segments in China. (Financial Daily)
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Hong Leong Bank Bhd (HLB) (HLBK MK, Hold, TP: RM6.30) has entered into a finance development coorperation
agreement with China Development Bank Corporation (CDB). HLB said the agreement set the platform for the group, including Hong Leong Islamic Bank Bhd and CDB to collaborate in various areas including funding financing opportunities, currency swaps, personnel exchange and training as well as information exchange. “This agreement effectively enables HLB to work closely with CDB, one of three policy banks and one of the largest banks in China. It forms the basis to coordinate with each other for CDB to expand and extend its funding capacity, financing support and financing channels into our local economic projects and financial system,” said HLB group managing director and chief executive Yvonne Chia. (Financial Daily)


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Perusahaan Otomobil Kedua Sdn Bhd (Perodua) has appointed Aminar Rashid Salleh as its new managing director with effect from Nov 16, 2009 to replace Datuk Syed Abdull Hafiz Syed Abu Bakar, who will complete his term on Dec 31, 2009. Perodua said yesterday Aminar Rashid, was currently the executive director and the head of strategic marketing group at UMW Toyota Motor Sdn Bhd, a subsidiary of UMW Holdings Bhd (UMWH MK, Hold, TP: RM5.52). (Starbiz)


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Berjaya Land Bhd (Bland) will start development work on its US$6.3bn (RM21.8bn) integrated property development prject in Vietnam in 2012 the company told Bursa Malaysia yesterday. The Nhon Trach New City (NTNC) township project was scheduled for completion in stages from 2015 to 2030. BLand says the estimated investment cost is US$400m (RM1.4bn). NTNC will be developed and managed by Berjaya NTNC Ltd, a newly incorporated company of BLand’s wholly owned subsidiary Berjaya Leisure (Cayman) Ltd (BL Cayman). BL Cayman received the investment certificate from the Vietnamese licensing authority for the NTNC project. NTNC is a 600ha project in the heart of Nhon TrachCity, about 30km from Ho Chi Minh City. (Starbiz)


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Industrial and Commercial Bank of China (ICBC), will get a licence to open in Malaysia when Chinese President Hu Jintao visits on Nov 10-11 and a raft of commercial deals will be signed. Citing an unnamed sernior Malaysian government official said yesterday that ICBC would get an operating licence and be allowed to open 4 branches. “We hope to get the approvals ready for the visit,” the official said. “There will be other economic initiatives, which will include invitations to
Chinese companies to participate in infrastructure ventures and take strategic stakes in Malaysian companies and projects.” (Financial Daily)

Some local business news of importance

The Sarawak Corridor of Renewable Energy (SCORE) has already attracted interest from investors, especially those in the heavy capital and energy intensive industries, despite its infancy stage said Daputy Chief Minister Tan Sri Dr George Chan. He said that 80% or RM267bn of the total proposed investment totaling RM334bn, which would spread over the next 20
years came from the private sector. Dr Chan said a few MNCs have decided to invest in SCORE and works were progressing smoothly and on schedule to meet the tight timelines set by its investors, particularly in the Samalaju Industrial Park, Tanjung Manis and Mukah Industrial Estate. (Malaysian Reserve)

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The Government’s proposal to impose a real property gains tax (RPGT) of 5% from Jan 1 may just be a temporary measure, says Taxand Malaysia Sdn Bhd managing director Dr Veerinderjeet Singh. “We feel that it is a temporary imposition. We think that in the long term, the original scale rates of 30%, 20%, 15%, etc will be coming back, he said. Prior to the
exemption of the RPGT in April 2007, tax on gains from property sales was on a progressive basis from 30% to 0% depending on the holding period of the property. Veerinderjeet however, said that total exemption from RPGT would be unlikely. “What would probably not change is the 5%,” he said. He added that property owners should be thankful that the RPGT was capped
at 5% and not higher. (Starbiz)

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New home buyers are expected to make higher payments for their loans with some banks increasing their mortgage rates early this month. Various banks showed lenders like Maybank, Public Bank, Standard Chartered Bank, Alliance Bank and EON Bank had revised upward their mortgage rates. Some have even scrapped the moving-cost element- legal fees, stamp duties and other disbursement fees for loan documentation by the banks – from their home-loan offerings. It is learnt that existing home loans would still be maintained at previous rates depending on the terms and condition of the contract. “Loan growth for the commercial banking sector has been subdue during the first 9 months at an annualised rate of 6.9% compared to the growth rate of 13.4% in 2008. However, deposits have been growing at a faster annualised rate of 20.5% during the same period. This invariably exerts pressure on the banks’ interest margins and eventually profitability,” Malaysian Rating Corp Bhd vice-president and head of financial institution ratings, Anandakumar Jegarasasingam said. The above banks have revised their rates to BLR minus 1.8% from BLR minus 2%-2.3%. (Starbiz)

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Prime Minister Datuk Seri Najib Razak said the outlook of Malaysian economy for Q3 has brightened. The improvements in the national economic outlook have come about “not by chance, but by choice”, he said. Prime minister said the government’s RM67bn fiscal stimulus packages have helped the economy through a global recession and generated muchneeded
economic activity to make up for a slowdown in private sector demand. (BT)

SIME, MAYBANK, IJM,SUNRISE,MAHSING,PARAMOUNT

Sime Darby Bhd (SIME MK, Hold, TP: RM8.10) aims to complete infrastructure work for its groundwater project in Perak by end-2012 and start supplying 500m litres a day (mld) to Selangor by January 2013. Dr Azuhan Mohamed, the head of water management at Sime Darby’s energy and utilities division said the foreign technology providers are likely to tie up with local players to make the bid for the project in Batang Padang more competitive. A South Korean company, Da Joo Construction Co Ltd, will bid for the consultant contract. Sime Darby’s total investment in the project is estimated at around RM1.3bn. The company is seeking a long-term supply contract of up to 60 years, Sime Darby chief executive officer Datuk Seri Ahmad Zubir Murshid previously said. (BT)

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Malayan Banking Bhd (Maybank) (MAY MK, Buy, TP: RM8.10) is not looking to expand its business in Turkey but is open to collaboration with its counterparts there, says president and CEO Datuk Seri Abdul Wahid Omar. “We are open to collaboration in terms of trade finance and products. The collaboration does not have to be in the form of equity,” he said. Second Finance Minister had said Bank Asya representatives had expressed the bank’s interest to tap the
expertise of Maybank and CIMB Bank Bhd to jointly establish Islamic banking operations in Turkey. On this, Wahid said Maybank would meet with the Finance Ministry to get more information. (Starbiz)

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IJM Corp Bhd (IJM MK, Hold, TP: RM3.64) and Scomi Engineering Bhd are eyeing new projects in India. Malaysian Property Inc (MPI), an initiative of the private and public sectors set up a year ago to project Malaysia as a property investment destination overseas, is also targeting India for the sale of local properties. IJM deputy CEO Teh Kean Ming said the group was
now bidding for projects with an estimated value of RM500m in India and are mainly highway and elevated infrastructure projects he said. Teh said the group was targeting to increase its order books in India to over RM1bn next year. Meanwhile Scomi International Pte Ltd president Kanesan Veluppillai said it was interested in bidding for new monorail projects in 7 Indian
cities. These projects involve constructioning 30km to 40km of monorail tracks. On its RM1.6bn monorail project in Mumbai, Kanesan said the group had completed about 25% of the 19km track. On Oct 30, Scomi Engineering signed an agreement with Geodisic Techniques Pvt Ltd, an India-based design and structural company to bid for a 59km monorail project in Bangalore.\
(Starbiz)

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Sunrise Bhd (SUN MK, Buy, TP: RM3.30) and CIMB Group, unit of CIMB Group Holdings (CIMB MK, Hold, TP: RM12.18) has launched a joint customer loyalty scheme that leverages on each others branding prowess to secure recurring business from existing clients. The Sunrise-CIMB Preferred Recognition Card offers cardholders discounts for their subsequent real estate purchases from Sunrise, besides local and regional priority privileges from CIMB Preferred. Some 1,300 cards have already been issued to existing customers. (Financial Daily)

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Mah Sing Group Bhd’s proposed en-bloc sale of “The Icon @ Mont Kiara” commercial property project for RM285.4m hit a snag yesterday, as the supposed purchaser failed to meet the conditions stipulated in the sale and purchase agreement signed 2 years ago. To recap, Maxim Heights Sdn Bhd, a wholly owned subsidiary of Mah Sing entered into a tripartite SPA on Nov 27, 2007 with Majlis Agama Islam Wilayah Persekutuan (MAIWP) and Prompt Symphony for RM285.4m. MAIWP is the owner of the proposed development site. The termination of the SPA would not have any impact on Mah Sing’s financials, the company said. Rather, it has come up with a fresh concept. Mah Sing now intended to develop services suites and market the project as “luxury garden terraces in the sky”. (Financial Daily)

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Paramount Corp Bhd is purchasing a 21.7 acre piece of land in Shah Alam, Selangor from The Titular Superior of the Brothers of Saint Gabriel for RM62.39m or RM66 per sqft. Paramount said that the master title of the land includes the premises of Monfort Boys Town, while its northern boundary abuts onto the NKVE. Part of the land measuring 10 acres has been designated for the building of a new campus for KDU College and another 11.8 acres designated for mixed development consisting of commercial development and condominiums. (Financial Daily)

Plenty of good news for US and UK, so can it last till the year end?

After seesawing through the session, stocks staged a rally to end higher Monday, with financial, technology andcommodity shares leading the charge. Stocks rallied in the morning after a key manufacturing index spiked to its highest levelin three and a-half years in October. An upbeat reading on pending home sales and Ford Motor's big profit report also added tothe morning bounce, giving investors a reason to jump back into stocks after last week's sell-off. But the morning rally turnedsour in the afternoon as weakness in financial, tech and transportation shares spearheaded a broader retreat. By the last hour,short-term investors used the selling as an opportunity to jump back in and scoop up a variety of shares. The Dow Jonesindustrial average gained 0.8% (+76.7 pts, close 9,789.4). The Nasdaq gained 0.2% (+4.1 pts, close 2,049.2) and the S&P 500gained 0.7% (+6.7 pts, close 1,042.9). U.S. light crude oil for December delivery gained US$1.13 to settle at US$78.13 a barrelon the New York Mercantile Exchange. (CNNmoney)

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Manufacturing in the U.S. expanded faster than anticipated in October, easing concern the economic recovery will be cutshort once government aid wanes. The Institute for Supply Management’s factory index rose to 55.7, a three-year high andexceeding every estimate of the 70 economists surveyed by Bloomberg News, data from the Tempe, Arizona-based group showed yesterday. Stocks rose as the data showed the world’s largest economy may be gaining momentum after growing lastquarter at the fastest pace in two years. More than US$2trn in global stimulus and a cheaper dollar may also lift salesoverseas, ensuring assembly lines keep humming into 2010 as factories rebuild depleted stockpiles. (Bloomberg)

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The number of contracts to buy previously owned homes in the U.S. rose in September for an eighth straight month asAmericans rushed to meet a deadline for a home-buyer tax credit. The index of signed purchase agreements, or pending homesales, rose 6.1% after a 6.4% gain in August, the National Association of Realtors said in Washington. Compared with a yearearlier, pending sales rose 19.8%, without adjusting for seasonal variations. Foreclosure-driven price declines and lowmortgage rates have also pushed sales up this year. Home sales may cool in coming months unless the credit is extendedunder a deal worked out by Senate Democrats. (Bloomberg)

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Spending on U.S. construction unexpectedly rose in September as residential builders rushed to finish projects inanticipation of a possible end to the first-time home-buyers tax credit. The 0.8% increase, the biggest since September 2008,followed a revised 0.1% drop in August that was previously reported as a 0.8% gain, Commerce Department figures yesterdayshowed. Spending on residential and government projects climbed, while outlays on private commercial construction slumpedfor a fifth consecutive month. Low borrowing costs, price declines and the government’s US$8,000 tax credit for first-timebuyers stabilized sales and spurred the biggest increase in residential construction in 26 years in the third quarter. Lawmakersare working on extending the credit, which may help support construction even as commercial real estate falters. (Bloomberg)

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President Barack Obama said the U.S. economy has pulled “back from the brink” and the government must now “getserious” about reducing debt and helping spur job growth. Addressing a panel of economists and business and labour leaders,the president said the government and private industry must take “bold, innovative action” to bring the unemployment ratedown and lay the foundation for future growth. This was the second time the full board has met to brief the president on ways tocreate jobs and encourage economic growth. Obama formed the advisory panel in February to provide an “independent voiceon economic issues.” Yesterday’s meeting focused on creating jobs through innovation. Obama said if “entrepreneurship” and“dynamism” are encouraged by the government “there’s no reason why we’re not going to be able to not only create jobs, butthe kind of sustainable economic growth that everybody is looking for.” (Bloomberg)

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Europe’s manufacturing industry expanded for the first time in 17 months in October, adding to evidence the region ispulling out of the worst recession in more than six decades. An index of manufacturing in the 16-nation euro area rose to 50.7from 49.3 in September, London-based Markit Economics said yesterday, confirming an Oct. 23 estimate for the gauge, whichis based on a survey of purchasing managers. The last time the index was above 50, indicating expansion, was in May 2008.Euro-area confidence in the economic outlook is at the highest since Lehman Brothers Holdings Inc. collapsed, and theInternational Monetary Fund last month forecast that the global economy will expand next year at a faster pace than previouslyprojected. (Bloomberg)

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U.K. manufacturing unexpectedly expanded in October at the fastest pace in two years, a sign factory production isrecovering from the economy’s longest contraction on record. A gauge based on a survey of companies rose to 53.7 from 49.9in September, the Chartered Institute of Purchasing and Supply and Markit Economics said yesterday in London. Economistspredicted 50, the median of 30 forecasts in a Bloomberg News survey showed. Readings above 50 indicate expansion.Yesterday’s figures will make the Bank of England’s task tougher as it gauges this week whether the economy needs furtherstimulus. While surveys of manufacturers and services companies have indicated the economy is recovering from the worstrecession since World War II, a report two weeks ago showed it unexpectedly contracted in the third quarter. (Bloomberg)

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U.K. house prices rose for a third month in October as increased demand for homes and a lack of properties for salepushed up values, Hometrack Ltd. said. The average cost of a home in England and Wales climbed 0.2% from September to156,400 pounds (US$258,000), the London-based property-research company said in an e-mailed statement yesterday. Houseprices fell 4.2% y-o-y. “The last six months has seen a continued improvement in housing market sentiment on the back ofrising demand and a lack of housing for sale,” said Richard Donnell, director of research at Hometrack. “Prices have firmed andthe discount between sales and asking prices is back to the same level it was at the start of the credit crunch over two yearsago.” Buyers are returning to the property market after home values dropped as much as a fifth from their 2007 peak andinterest rates fell to a record low. (Bloomberg)

PBB, HLBK,MAYBAN,CIMB,BOUSTEAD,PUNCAK,AIRASIA,MAHB

Putting an end to weeks of market rumours, Public Bank Bhd (PBK MK, Buy, TP: RM12.80) said yesterday its nonexecutive chairman Tan Sri Dr Teh Hong Piow has recovered from a minor operation and will not be selling his stake in the bank. “Tan Sri Teh, the founding and single largest shareholder who owns total interests of 24.08% in Public Bank, has stressed that he has absolutely no intention of selling his stake in Public Bank”, the bank said in a statement. This overdue statement will perhaps finally and effectively put an end to rumours that have been circulating that Teh’s exit from Public Bank was imminent following news that he had been admitted to hospital for an operation in July. (Financial Daily)

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Hong Leong Bank Bhd (HLB) (HLBK MK, Hold, TP: RM6.30) is venturing into the consumer lending business in China through a 49:51 joint venture (JV) with Bank of Chengdu Co Ltd. This marks HLB’s further inroad into China’s financial services sector after its maiden foray in October when it acquired a 20% stake in Bank of Chengdu. According to an announcement yesterday, HLB and Bank of Chengdu will form a licensed consumer finance company known as Sichuan Jincheng Consumer Finance Ltd Liability Co (SJCF). “The business of SJCF will principally be in consumer financing. The registered capital will be 320m yuan (about RM160m), while HLB’s contribution shall be 156.8m yuan (RM78.4m), which will financed from internally generated funds,” said HLB. For its latest venture in China, HLB will provide SJCF with personnel, technical expertise and support in areas such as product development, risk management and information technology. (Financial Daily)

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One of Turkey's largest banks, Bank Asya, has expressed interest in working with Malaysian lenders Malayan Banking Berhad (MAY MK, Buy, TP: RM8.10) and CIMB (CIMB MK, Hold, TP: RM12.18) to develop Islamic banking in the republic. Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said a joint venture may be possible, although this would ultimately depend on how strict Turkish regulations are in terms of foreign equity ownership in a bank. He hopes that at least one of the two banks will explore potentials for collaboration with Bank Asya. (BT)

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Boustead Holdings Bhd (BOUS MK, Buy, TP: RM3.94) is buying a 51% stake in Atlas Hall Sdn Bhd for RM8m. 20% of the stake was from vendor Tan Sri Abdul Rashid Abdul Manaf who is also a director of Atlas Hall. Boustead said that the stake buy-in was part of a group strategy to become a player in the oil & gas industry. The deal, which was slated for completion this
month, still required the green light from the respective boards of the two companies. (Malaysian Reserve)

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Puncak Niaga Holdings Bhd (PNH MK, Buy, TP: RM3.66) told the exchange yesterday that it has formed a 60:40 jointventure company with India’s Lanck Infratech Ltd to participate in a bid for a water supply and drainage tender in India. The project was identified as Hogenakkal water supply and flourosis mitigation Project-Package 1 called by Tamil NaduWater Supply and Drainage Board, India. (Starbiz)

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Malaysian budget carrier AirAsia (AIRA MK, Buy, TP: RM1.80) and subsidiary AirAsia X, which last month stunned the aviation market by offering short-haul international flights out of Kuala Lumpur priced from RM1 to RM11 (HK$2.27 to HK$25), have opened a new battlefront in the cargo market. Azran Osman Rani, the chief executive of AirAsia X’s target isto double the contribution of cargo revenue to 8% of the total for the two airlines in two to three years. To reach this target, the absolute increase in cargo revenue would have to be more than double the growth in revenue from passenger tickets, which would also be increasing over the same period, Azran said. To achieve its aim, AirAsia had launched a pricing strategy in the cargo market that was even more aggressive than its campaign on rock-bottom passenger fares, so that it could build up its brand name among exporters, he said. But agents said freight rates to Europe from Kuala Lumpur would be prices at a 30% discount to the average market price, which would be aimed at overcoming the disadvantage to shippers of a longer transit time for trucking shipments from London’s Stansted Airport, which AirAsia X started serving in March, to Heathrow Airport. (Financial Daily)

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Malaysia Airports Holdings Bhd (MAHB) expects passenger traffic growth to hit 4 to 5% next year in light of the positive trends in the global industry in the last few months. The industry is expected to fare better next year as the global economy is predicted to show recovery and hence boost air travel, MAHB managing director Tan Sri Basir Ahmad said. The airport operator had projected passenger volume to reach between 3 and 4% this year compared to last year. In 2008, total passenger volume at 39 airports operated by MAHB in the country rose 5% to 47.45m. (BT)

SIME,AIR ASIA, MUHIBBAH,IJM,TNB,

Sime Darby Bhd (SIME MK, Hold, TP: RM8.10) has priced its RM2bn three-, five- and seven-year Islamic medium-termnotes (IMTN) issued under the Islamic medium-term note programme of RM4.5bn and Islamic commercial paper/IMTNprogramme of RM500m with a combined master limit of RM4.5bn. The IMTNs were issued under the Islamic principle ofMusyarakah and carries a semi-annual profit rate of 3.55% per annum for the three year tranche with a nominal value ofRM300m, 4.38% per annum for the five-year tranche with a nominal value of RM700m, and 4.75% per annum for the sevenyeartranche with a nominal value of RM1bn. (StarBiz)

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AirAsia (AIRA MK, Buy, TP: RM1.80) will defer delivery of another eight Airbus A320 aircraft due in 2010 by four yearsto 2015 because of infrastructure constraints at its Kuala Lumpur air terminal. Until a new Low-Cost Carrier Terminal wasconstructed, the current overcrowded budget terminal would not be able to accommodate AirAsia’s fleet expansion plans, itsaid. The decision to further scale down on deliveries would allow AirAsia to avoid the costs of having idle or under-utilisedaircraft, it said. (StarBiz)

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Muhibbah Engineering Bhd (MUHI MK, Sell, TP: RM1.11) has commenced arbitration against Gerbang Perdana Sdn Bhdin respect of a claim amounting to about RM32.7m. Muhibbah said that the main contractor, Gerbang Perdana, hadappointed it to undertake the road bridge-marine approach subcontract but, when the overall project was cancelled in 2006,Gerbang Perdana had ordered a cease of works on the subcontract but, to date, has not fully paid the company. Muhibbahsaid it has since commenced mediation and followed by arbitration in respect of claim against Gerbang Perdana. It said that,should the arbitration be successful, it was expected to have positive financial effect to the group. (Malaysian Reserve)

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The investment vehicle set up jointly by 1Malaysia Development Bhd (1MDB) and PetroSaudi International Ltd islooking at acquiring a “strategic” stake in IJM Corp Bhd (IJM MK, Hold, TP: RM3.64). The joint venture (JV) may acquirethe IJM stake from Zelan Bhd, which holds 82.33m shares or an 8.77% stake in IJM as of June 30. The stake was valued atRM395.2m based on IJM’s share price that closed at RM4.8 last Friday. The JV’s intention for the acquisition is to tap IJM’sconstruction expertise, which could be useful for some of the projects it plans to invest in, and not to take over the constructionoutfit. (The Edge)

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The study paper on the review of the national five fuel policy is almost completed, Prime Minister Datuk Seri MohdNajib Razak said yesterday. “We are in the process of reviewing the country’s fuel mix. This will not change in the immediateterm but in the medium and long term” he said. The Energy, Green Technology and Water Ministry and Tenaga Nasional Bhd(TNB) (TNB MK, Buy, TP: RM9.90) are fine tuning the study paper before submitting it to the government, he said afterlaunching the 60th anniversary celebrations of Lembaga Letrik Negara/TNB in Kuala Lumpur. Mohd Najib said the countryneeded to reduce reliance on natural gas and coal as energy sources and look at other sources like hydro-electricity andrenewable energy. Asked whether nuclear energy was covered, Mohd Najib said it was being studied and that nuclear energygeneration required a long period with process of planning to the first nuclear reactor for initial energy generation taking 12 to15 years. He also said that TNB needed to be sensitive in supplying electricity as even a disruption of one or two minutes couldcause losses amounting to billions of ringgit. (Malaysian Reserve)

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PPB Group Bhd has proposed to dispose of its 100% equity interest in Malayan Sugar Manufacturing Co Bhd (MSM) toFelda Global Ventures Holdings Sdn Bhd (FGVH) for RM1.22bn. It also proposed to sell 50% of its equity interest in KilangGula Felda Perlis Sdn Bhd and land in Chuping, Perlis, to FGVH for RM26.3m and RM45m respectively. The purchaseconsideration represents price-to-earnings ratio of 9.78 times and price-to-book ratio of 2.46 times. PBB’s cost of investment inMSM was RM50.8m, which was made over the period from 1976 to 1999. The proposed disposal of MSM will result in gains ofRM1.17bn at company level and RM723.81m at group level. (StarBiz)* * * * *

And suddenly the bad news surface.....

Stocks tumbled Friday, more than erasing the previous session's gains, as investors dumped a variety of shares at the end ofa rough week and choppy month on Wall Street. Bond prices rallied, sending yields lower, in a classic flight-to-quality. Thedollar was mixed versus other major currencies. Oil and gold prices fell. The Dow Jones industrial average lost nearly 2.5% (-250 pts, close 9,712.73). The Dow lost as much as 278 points earlier. It was the Dow's biggest one-day selloff on a point basissince April 20. The S&P 500 index fell 2.8% (-30 pts, close 1036.19) and the Nasdaq composite shed 2.5% (-52 pts, close2045.11). U.S. light crude oil for December delivery retreated US$2.87 to settle at US$77 a barrel on the New York MercantileExchange after rallying 3% in the previous session. (CNN Money)

* * * * *

Americans cut spending for the first time in five months and a gauge of confidence weakened, signaling consumers willmake a limited contribution to the recovery without government incentives. Consumer spending fell 0.5% in September after a1.4% jump in August, Commerce Department figures showed in Washington. The Reuters/University of Michigan final index ofconsumer sentiment decreased to 70.6 in October from 73.5 the month before. Mounting jobs losses, stagnant incomes andthe expiration of programs such as the cash-for-clunkers auto rebates threaten to hold back household spending as the nationemerges from a recession. (Bloomberg)



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