KUALA LUMPUR (Mar 27): Faber Group Bhd is expanding its income stream to include industrial facility management. The move will see the company reducing dependence on its current hospital support services and property development operations.
Faber (fundamental: 2.1; valuation: 0.9) managing director/CEO Azmir Merican said the company was eyeing income from the management of industrial facilities including refineries, plants, and oil and gas structures in Malaysia and abroad this year.
“These assets are some of the opportunities that we are seeing this year. It will chart our presence in the healthcare, infrastructure and commercial sectors, which will drive sustainable business growth," Azmir told reporters after Faber's extraordinary general meeting (EGM) today.
Faber's expansion into these business segments followed its acquisition of two companies last year.
Faber had in October last year acquired Projek Penyelenggaraan Lebuhraya Bhd (Propel) and Opus Group Bhd from UEM Group Bhd for a combined sum of RM1.5 billion. Propel and Opus were valued at RM500 million and RM651 million respectively.
UEM Group is Faber's controlling shareholder with a 70.68% stake.
According to Faber's website, Propel's management portolio includes highways, airports and commercial buildings.
Meanwhile, Opus' portfolio includes highways, rail systems, and airports. Azmir said the acquisitions of Propel and Opus had expanded Faber's global presence.
"The acquisitions have transformed Faber from an integrated facility management company to become the largest asset and facility management company in the country with footprints in India, New Zealand, Australia, Canada, besides the UK and Middle East," Azmir said
Earlier, Faber shareholders had at the EGM approved its plan to change the company's name to UEM Edgenta Bhd. The change is expected to take effect next month.
Azmir said the new name symbolised Faber's commitment to business growth and its major shareholder.
“The name is an insignia for us to become a cutting-edge organisation that lives up to its vision of optimising assets to improve lives. It symbolises our vision to unify our capabilities and services, which will align our brand relationship with our major shareholder,” he said.
On capital expenditure (capex), Azmir said Faber had set aside RM120 million in current financial year ending December 31, 2015.
Of the total capex, RM40 million will be allocated for asset development and management consultancy division while RM44 million will be channelled to its infrastructure management unit.
The remaining RM36 million will be spent on its integrated facilities management concession according to him.
At 5pm, Faber shares fell two sen or 0.6% to close at RM3.29 for a market capitalisation of RM2.68 billion.
Some 1.1 million shares changed hands.
(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.)