Jiankun, Integrax, HLFG, Mulpha Land, Boustead, AirAsia X

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KUALA LUMPUR (Apr 6): Based on corporate announcements and news flow today, the companies that may be in focus tomorrow (Tuesday, April 7) could include the following: Jiankun International Bhd, Integrax Bhd, Hong Leong Financial Group Bhd, Mulpha Land Bhd, Boustead Holdings Bhd and AirAsia X Bhd.

Jiankun International Bhd has proposed to acquire 93 freehold vacant subdivided plots — with a combined land area of 101,517 sq ft — in Seri Kembangan, Selangor for RM22.5 million, for a new terrace-house development costing some RM50 million.

In a filing with Bursa Malaysia today, Jiankun (fundamental: 0.6; valuation: 0.6) said its wholly-owned subsidiary Nagamas Bizworks Sdn Bhd has entered into a conditional sale and purchase agreement with Bison Ventures Sdn Bhd for the proposed acquisitions.

Jiankun said the land, previously identified as parent Lot 5682, was originally approved by the planning authority on Jan 7, 2008 for the development of 93 units of three-storey terrace houses.

The purchase price for the land is expected to be funded by internal funds and bank borrowings. The deal is expected to be completed in the fourth quarter of 2015.

Integrax Bhd co-founder and deputy chairman Amin Halim Rasip has ceased to be a substantial shareholder of the port operator, following the disposal of 60.69 million shares which approximates to a 20.18% stake in the company.

In a filing with Bursa Malaysia today, it was revealed that the shares were disposed at a price of RM3.175 per share, bringing the total disposal proceeds to RM192.68 million.

The filling also stated that the circumstances which brought about the disposal was Amin’s acceptance of the general offer for his shares from Tenaga Nasional Bhd (TNB).

Before today’s disposal, Amin controlled some 24.76% shareholdings in Integrax. He had finally accepted TNB’s (fundamental: 1.3; valuation: 1.8) offer after disputing on the offer price for the past two months.

Hong Leong Financial Group Bhd (HLFG) has proposed to acquire Hong Leong Bank Bhd’s (HLBB) Menara Raja Laut building and the parcel of land it sits on for RM220 million cash.

HLFG’s (fundamental: 2.6; valuation: 2.4) indirect 70%-owned subsidiary Hong Leong Assurance Bhd (HLA) today entered into a sale and purchase agreement with HLBB (fundamental: 2.8; valuation: 2.2) for the proposed acquisition, the banking and financial group told Bursa Malaysia in a statement.

It said the RM220 milllion price tag for the office building located at Jalan Raja Laut, Kuala Lumpur, will be fully funded from HLA shareholders’ funds.

According to HLFG, it has obtained approval from Bank Negara Malaysia for the proposed acquisition and it is now pending shareholder approval.

The proposed acquisition is expected to be completed by the first half of this year.

Mulpha Land Bhd's independent adviser has advised its shareholders to reject the takeover offer by Teladan Kuasa Sdn Bhd at 49.7 sen a share, stating that it is “not fair and not reasonable”.

According to a circular filed with Bursa Malaysia today, MainStreet deemed the offer price of 47.9 sen “not fair” because it represents a discount of 29% from its realisable net asset value (RNAV) of 70 sen a share.

“We are of the view that the RNAV valuation is the most appropriate method in approaching the valuation of property-based companies such as Mulpha Land. Hence, the RNAV valuation is the main valuation methodology used to determine the fair value of Mulpha Land shares,” it said.

An analysis of Mulpha Land’s historical share price performance also showed a discount of 20.25% to the volume weighted average (VWAP) of Mulpha Land (fundamental: 1.3; valuation: 1.3)’s share price.

To recap, Mulpha Land received a mandatory takeover offer from Teladan Kuasa, a private vehicle of Datuk Fakhri Yassin Mahiaddin, to acquire Mulpha Land shares at 49.7 sen a share.

The offer came after Teladan Kuasa exercised a call option to acquire 75 million option shares. This represents up to 32.85% equity interest in Mulpha Land.

Upon completion of the call option, the aggregate equity interest of Teladan Kuasa, Ketapang Capital Sdn Bhdand Fakhri, who are ultimate offerors and persons acting in concert with them, would reach 50.38% of Mulpha Land shares. The call option exercise was completed on March 26, 2015.

Boustead Holdings Bhd is currently in talks with the government on how implement the controversial automated enforcement system (AES), which is targeted to track traffic offences, its deputy chairman and group managing director Tan Sri Lodin Wok Kamaruddin said.

Boustead is in the midst of buying a 50% equity stake in Irat Properties Sdn Bhd for RM127.8 million cash, which will be taking over the concession to operate AES from two companies – ATES Sdn Bhd and Beta Tegap Sdn Bhd.

However, Lodin declined to reveal the price for Irat to take over the concession.

Speaking at a press conference after the group’s annual general meeting this morning, Lodin said, "The acquisition of ATES and Beta Tegap is done on the understanding that we (Boustead) should be able to unlock the value in our investments."

"We are finalising the terms with the government in terms of ensuring how the project can be undertaken. We will supply the cameras and will have a role in helping educate the public on how to observe rules and regulations," he added.

Lodin said that there will be minor changes to the current concession agreement terms but Boustead (fundamental: 0.65; valuation: 2.0) is looking to achieve 18% to 20% return on its investments in taking over the operations of AES and for a longer concession period.

According to Lodin, Boustead is looking to install up to 500 new cameras across the country in the future. So far only fourteen cameras have been installed under the current concession.

Long-haul, budget airline AirAsia X Bhd (fundamental: 0.2; valuation: 0.8) is set to spread its wings to Hawaii, London and a new destination in Europe that it is not ready to reveal yet by year-end, as part of its plan to drop underperforming routes and add more promising ones to meet its forecast of returning to profit this year.

"Within the next eight months, we will be in Hawaii, London and another destination in the European Union (EU)," AirAsia group chief executive officer Tan Sri Tony Fernandes told a press conference after the opening of Tune Group Sdn Bhd's new headquarters at Wisma Tune here today.

"We are very excited about the EU. We have to be in the EU," Fernandes added. AirAsia X currently flies to destinations in the Asia-Pacific region.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)