Thursday, 31 March 2011

DPMM offers to buy JCorp stake in Kulim

The Malay Chamber of Commerce (DPMM) has made an offer to buy Johor Corp's (JCorp) 53 per cent stake in Kulim (Malaysia) Bhd (2003), a plantation group with interests in fast food business.

Its president Syed Ali Alattas said a letter was sent to Johor Menteri Besar Datuk Abdul Ghani Othman on March 28. The next day, another letter on the same matter was sent to the Prime Minister.

At a press conference held in Kuala Lumpur yesterday, Syed Ali refused to disclose the value of the bid.

"At this juncture, we can't reveal the numbers as we need to negotiate on the price first. However, I can assure that the price DPMM is offering is fair," he said.

Based on Kulim's closing price of RM3.34 yesterday, the group is worth RM4.21 billion. JCorp's stake is valued at RM2.23 billion but DPMM cannot just buy that block because of takeover rules.

Under the rules, if a buyer takes a third of a company, it must make the same offer for the rest of the shares.

DPMM has invited government-linked agencies and organisations like Tabung Haji, Permodalan Nasional Bhd and Majlis Amanah Rakyat (Mara) to join the bid through a special purpose vehicle (SPV) which is being set up.

"We want them to come onboard and become investors in the SPV," he said, noting that the bid is to uphold the honour of Bumiputeras. He did not elaborate.

He claimed that several government agencies and cooperatives have indicated their interest to join but declined to reveal any names.

In recent reports, JCorp's former president and chief executive officer Tan Sri Muhammad Ali Hashim reportedly claimed that the management of JCorp was planning to sell Kulim.

JCorp holds a controlling 53 per cent stake in Kulim, which in turn owns 57.5 per cent of QSR Brands Bhd. The latter holds 50.6 per cent of KFC Holdings (Malaysia) Bhd (KFCH).

Syed Ali also claimed that DPMM is the only Bumiputera bidder in the race for Kulim shares.

"We are sure the company will be up for sale one way or the other because JCorp has RM6 billion debts which have to be settled by next year," he said.

Meanwhile, JCorp president and chief executive Kamaruzzaman Abu Kassim was reluctant to make any statement when approached by Business Times.

"It's better if I don't make any statements now. The only thing I can say is that we are reviewing what we have (assets) now," he said.

He considered news of JCorp selling Kulim as outside talks and nothing more.

"They (outside parties) can say whatever they want," he said.

Kamaruzzaman had said earlier that QSR and KFCH are the group's prized assets and that it would not be a wise business decision to sell a profitable "cash business".

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