MSWG Weekly Newsletter 25 August 2017 (English)

Friday, 25 August, 2017

25 August 2017







The Board of Directors of SGB announced that the company has submitted a formal proposal today to:

(i)      the Board of SESB in respect of the proposed merger of SESB with the company; and

(ii)    the Board of SEB in respect of the proposed merger of SEB with the company,

to be undertaken by way of a members’ scheme of arrangement pursuant to Section 366 of the Companies Act, 2016.

The Boards of SESB and SEB are to revert to the company no later than 12.00 noon on 10 October 2017, with their decision whether to put forward the proposed merger to their respective shareholders for consideration.

In conjunction with the above proposed mergers, the company also proposes to undertake the following prior to the implementation of the proposed mergers:

(i)      proposed consolidation of every 2 existing ordinary shares in the capital of the company into 1 ordinary share (“Consolidated Share”) on an entitlement date to be determined and announced later; and

(ii)     bonus issue of up to 671,128,549 warrants in the company on the basis of 7 warrants for every 10 Consolidated Shares held on an entitlement date to be determined and announced later.

[Source: SGB’s announcement on Bursa Malaysia’s website on 21 August 2017]



After taking into consideration the poor financial performance of the Scomi group, we concur with the rationale and benefits stated by SGB on the Proposed Merger. We hope that after going through the Proposed Merger, the SGB group could consolidate and streamline its organisation structure so that it would be able to move forward to look for new partners and funding to turn around its business as soon as possible.



For this week, the following are the AGMs/EGMs of companies which are in the Minority Shareholder Watchdog Group’s (MSWG) watch list.

The summary of points of interest is highlighted here, while the details of the questions to the companies can be obtained via MSWG’s website at


Date & Time



28.08.17 (Mon)
10.00 am

Reliance Pacific Bhd (AGM)

Avillion Port Dickson, 3rd Mile, Jalan Pantai, Port Dickson

28.08.17 (Mon)
02.30 pm

WCE Holdings Bhd (AGM)

Holiday Villa Hotel & Suites Subang, 9 Jalan SS12/1, Subang Jaya

29.08.17 (Tue)
09.00 am

Anzo Holdings Bhd (AGM)

Tree Café (under Only World Group), Kawasan Perindustrian Temasya, Shah Alam

29.08.17 (Tue)
09.00 am

Bright Packaging Industry Bhd (EGM)

Bukit Jalil Golf & Country Resort, Jalan Jalil Perkasa 3, Bukit Jalil, KL

29.08.17 (Tue)
10.00 am

MMAG Holdings Bhd (AGM)

Tropicana Golf & Country Resort, Jalan Kelab Tropicana, PJ

29.08.17 (Tue)
02.00 pm

Lingkaran Trans Kota Holdings Bhd (AGM)

Kota Permai Golf & Country Club, Kota Kemuning, Section 31, Shah Alam

30.08.17 (Wed)
09.00 am

DRB-Hicom Bhd (AGM/EGM)

Holiday Inn Kuala Lumpur Glenmarie, Shah Alam

30.08.17 (Wed)
10.30 am

Amcorp Properties Bhd (AGM)

Tropicana Golf & Country Resort, Jalan Kelab Tropicana, PJ

30.08.17 (Wed)
10.30 am

Panasonic Manufacturing Malaysia Bhd (AGM)

IDEAL Convention Centre Sdn Bhd Corporate Tower, Shah Alam

30.08.17 (Wed)
11.30 am

YLI Holdings Bhd (AGM)

Concorde Hotel, Jalan Sultan Ismail, KL

30.08.17 (Wed)
03.00 pm

Sunway Bhd (EGM)

Sunway Resort Hotel & Spa, Persiaran Lagoon, Bandar Sunway, Subang Jaya


The points of interest to be raised:


Points/Issues to Be Raised

Reliance Pacific Bhd 

Could the Board share on the key measures taken by the company to address the declining trend of the company’s revenue in the last five financial years?

WCE Holdings Bhd 

The tender process for the remaining two packages i.e., Package 7 and Package 11 are expected to be completed by September 2017.

  • Given such a short time frame for Package 7 and 9 to be started in September 2017, would there be a concern of not being able to meet the 5-year timeline to complete the entire Project in the fourth quarter of 2019?
  • What would be the penalty if the Group is unable to complete the Project in the fourth quarter of 2019?

Anzo Holdings Bhd 

In the Chairman’s Statement, it was stated that in May 2017, the Company announced its return to the black after 16 consecutive loss-making quarters.

  • Would the Company be able to sustain its performance for FY2018?
  • What is the outlook for the Timber division?

MMAG Holdings Bhd 

The Group recorded loss before tax for the last three (3) consecutive financial years. As stated in the Management Discussion & Analysis, the higher loss before tax for FY 2017 was mainly attributed to the higher depreciation and amortisation charges, allowance for impairment loss on bad and doubtful debts and allowance for impairment on slow moving inventories recognised during the financial year.

  • What are the key measures taken by the Board to improve the performance of the Group?
  • When is the Board expecting the Group to turn around?

Lingkaran Trans Kota Holdings Bhd

Given the completion of the Kelana Jaya and Ampang Light Rail Transit (LRT) Extension Lines in June 2016 and the MRT opening of the Sungai Buloh-Kajang line under Phase 1 between Sungai Buloh and Semantan in December 2016, how would the Board see the impact and assess the impact on traffic volume over the medium to longer term?

DRB-Hicom Bhd

The Group managed to reduce its pre-tax loss from RM822.1 million in FY2016 to RM222.2 million in FY2017.

What would be the expected timeframe for DRB-Hicom to turn around and return to profit?

Amcorp Properties Bhd 

The Group continued with its partnership with Grosvenor to tap into two global cities, Madrid in Spain and Hong Kong.

Could the Board share on the Group’s prospects in these two cities?

Panasonic Manufacturing Malaysia Bhd

Page 7 of the Annual Report stated that the Company’s Home Appliances Business segment achieved marginally higher revenue, but recorded a lower profit before tax of RM59.1 million for FY2017, mainly due to lower sales volume of certain products with higher profit margin.

What are the measures taken by the Company to ensure there is sustainability for the sale of products with higher profit margin?

YLI Holdings Bhd


Key Audit Matters - Property Plant and Equipment (“PPE”)( Note 11(d))

In the previous financial year, the Group undertook a review of the recoverable amount of the capital work in progress which led to the recognition of an impairment loss of RM585K on the plant and machinery in progress with cost of approximately RM8.9 million.

In FY2017, the Group estimated the recoverable amount of the capital work in progress at RM8.2 million.

Does the Board foresee another impairment exercise to be taken in FY2018 and please explain the reliability of the estimated recoverable amount?

Sunway Bhd 

Considering the sustainable performances, profitability, earnings and dividend per share expectations that could result in the appreciation of the market price of Sunway Shares higher than its proforma NA of RM1.55 per Sunway Share, would the Board consider any premium for the actual exercise price of the Warrants to make it attractive to minority shareholders for conversion into Sunway shares over the medium to longer term?




RHB and AMMB announced that after much deliberation and negotiations, both RHB and AMMB had not been able to reach an agreement on mutually acceptable terms and conditions for the proposed merger of the businesses and undertakings of RHB and AMMB (“Proposed Merger”).

Following thereto, both parties have mutually agreed to end the negotiations and not proceed with the Proposed Merger.  In this respect, the exclusivity period pursuant to the exclusivity agreement between both parties dated 1 June 2017 would lapse with immediate effect.

[Source: RHB and AMMB’s announcement on Bursa Malaysia’s website on 22 August 2017]



The Board of Directors of MBSB announced that the company had on 18 August 2017 received notification from Bank Negara Malaysia (“BNM”) vide its letter dated 18 August 2017, that the Minister of Finance has granted approval for the proposed acquisition by MBSB of 100% interest in the shares of Asian Finance Bank Berhad pursuant to the Islamic Financial Services Act 2013.

[Source: MBSB’s announcement on Bursa Malaysia’s website on 18 August 2017]



Malaysia's economy grew at faster pace of 5.8% in Q2

New vehicles sales in July ease 3.4 per cent

Malaysia's external debt lower in Q2 at RM877b

BNM objection to SGX launch of ringgit futures meant for Malaysians

IRB drops winding-up petition against Country Heights unit after tax liability settled

SSM offers leeway to select private companies for audit exemption\

Nakamichi Corp director resigns in protest of public reprimand



Japan manufacturers most optimistic in decade as economy grows

India’s central bank governor says state banks need more capital

China to curb "irrational" overseas Belt and Road investment

Fed policymakers grow more worried about weak inflation

PwC fined £5.1 mil in largest-ever penalty from watchdog

US jobless claims drop to near six-month low

Global economy looks set for a year of faster, firmer growth

MSWG Analysts

Lya Rahman, General Manager,
Rebecca Yap, Head, Corporate Monitoring
Quah Ban Aik, Head, Corporate Monitoring
Norhisam Sidek, Manager, Corporate Monitoring
Wong Kin Wing, Manager, Corporate Monitoring,
Hoo Ley Beng, Manager, Corporate Monitoring 

Elaine Choo, Manager, Corporate Monitoring

Muhammad Faris bin Mohamed Yusof, Analyst, Corporate Monitoring


•           With regard to the companies mentioned, MSWG holds a minimum number of shares in all these companies covered in this newsletter.

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25.08.2017 MSWG Weekly Newsletter 25 August 2017 (English)