Newsbreak: Speculation rife about ex-Boustead MD Amrin heading to UEM Sunrise

This article first appeared in The Edge Malaysia Weekly, on December 7, 2020 - December 13, 2020.
Amrin has led companies such as Sime Darby Property, Media Prima, Sistem Televisyen Malaysia and Natseven TV. (Photo by Suhaimi Yusuf/The Edge)

Amrin has led companies such as Sime Darby Property, Media Prima, Sistem Televisyen Malaysia and Natseven TV. (Photo by Suhaimi Yusuf/The Edge)

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FORMER managing director of Boustead Holdings Bhd Datuk Seri Amrin Awaluddin might be heading to UEM Sunrise Bhd to become its MD/CEO, say sources.

Amrin is slated to fill the seat after the resignation of Anwar Syahrin Abdul Ajib in October, people familiar with the matter tell The Edge. Anwar Syahrin became the MD of independent power producer Malakoff Corp Bhd on Dec 1.

When contacted, UEM Sunrise said no decision had been made yet. “UEM Sunrise is conducting a robust and meticulous search for a new MD or CEO after the departure of Anwar Syahrin on Oct 30,” says its chairman Datuk Noorazman Abd Aziz in response to questions emailed by The Edge.

“For now, no decision has been made. We will release a proper announcement on a timely basis as required by Bursa Malaysia,” he adds.

On Nov 6, Boustead announced that Amrin was stepping down as MD of the diversified conglomerate on Nov 15 but gave no reason for his departure. The position was then filled by Datuk Seri Mohammed Shazalli Ramly on Dec 1.

However, The Edge understands that the offer to Amrin to helm Lembaga Tabung Angkatan Tentera (LTAT) remains on the table. On Nov 6, reported, quoting sources, that Amrin might become the new CEO of the armed forces pension fund, a position left vacant after the resignation of Nik Amlizan Mohamed on Sept 30. She now holds a similar position at Kumpulan Wang Persaraan (Diperbadankan).

Nevertheless, if Amrin does go to UEM Sunrise, it would not be his first stint heading a property development company. He was group MD of Sime Darby Property Bhd from 2017 to 2019. Prior to that, he led companies such as Media Prima Bhd, Sistem Televisyen Malaysia Bhd and Natseven TV Sdn Bhd.

The changes come at a time when Eco World Development Group Bhd is considering a proposal by Khazanah Nasional Bhd’s wholly-owned subsidiary UEM Group Bhd to merge with its loss-making property unit UEM Sunrise via a share and warrant swap.

Both UEM Sunrise and EcoWorld have to decide by Jan 2 whether to proceed with discussions on the proposed merger. If they wish to proceed, they must jointly submit an application, by Jan 15 at the latest, to the Securities Commission Malaysia for a final extension of time based on a timeline agreed upon by their boards of directors.

In the proposal, UEM Sunrise would issue new shares at 44.3 sen each and exchange them for EcoWorld shares at an exchange value of 46.9 sen each, for a swap ratio of 1.058. Upon completion of the proposed merger, EcoWorld would become a wholly-owned subsidiary of UEM Sunrise and be delisted.

Shares in EcoWorld have declined by 42% so far this year to settle at 43 sen last Thursday, valuing the company at RM1.26 billion. Meanwhile, UEM Sunrise dropped 31% during the same period to close at 46 sen, giving it a market capitalisation of RM2.32 billion.

On Oct 5, UEM Group said the proposed merger would create an opportunity for an existing government-linked company to be in partnership with the private sector to create one of the country’s largest property developers with a projected gross development value of RM173.2 billion and a total land bank of more than 6,880ha locally.

Last week, Finance Minister Tengku Datuk Seri Zafrul Aziz, in a written parliamentary reply to a question from Kepong Member of Parliament Lim Lip Eng, said the proposed merger does not require the approval of the Cabinet. “Any decision related to this proposed merger is commercial in nature and it is the responsibility of the companies involved to ensure that this merger produces the best synergy by taking into account the interests of the shareholders of their respective companies,” he said.

UEM Sunrise slipped into the red in the first nine months ended Sept 30, 2020 (9MFY2020) with a net loss of RM144.17 million compared with a net profit of RM97.56 million a year ago. Revenue fell 69.9% year on year to RM525.25 million in 9MFY2020.

The poor financial performance was mainly attributed to the impact of the Covid-19 pandemic, as the group recorded lower revenue in the domestic segment due to lower sales and slower progress completion during the Movement Control Order and Conditional MCO periods. In Australia, the lockdown in Melbourne, imposed in July, has affected the handover and settlement of its high-rise developments Aurora Melbourne Central and Conservatory.

Contributions from UEM Sunrise’s joint-venture and associate companies were similarly affected. The losses were also compounded by costs of inventories written down and foreign exchange losses.

EcoWorld, meanwhile, saw its net profit for the nine months ended July 31, 2020, fall 43.7% y-o-y to RM68.71 million on lower revenue of RM1.36 billion, down 12.5% from the previous corresponding period.



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