DRB-Hicom plans high-end boutique luxury mixed developments in Langkawi

Larger Smaller Reset KUALA LUMPUR (Dec 21): DRB-HICOM BHD []'s unit has entered into a swap agreement to convert the status of its land in Langkawi from Malay reserve (MR) to non-Malay reserve with a view to undertake high-end boutique luxury mixed developments there.

It said on Wednesday that its unit Rebak Island Marina Bhd (Rebak) had entered into the agreement with Northern Gateway Free Zone Sdn Bhd (NGFZ) to change the designation of 333 acres of land owned by Rebak from MR to non-MR status of 350 acres freehold land in Bandar Kota Perdana, Kubang Pasu, Kedah for RM76 million cash.

DRB-Hicom said Rebak owned 379.78 acres leasehold land on Pulau Rebak Besar, Langkawi as well as 4.70 acres of freehold land.

The conglomerate said the swapping of the land status was an allowed exercise to convert the status of MR land to non-MR land subject to the relevant conditions imposed by the Kedah state government.

On the rationale for the land status conversion, DRB-Hicom said that there was a recent surge in the exodus of high net worth individuals to the Asean region which had contributed to the success of boutique luxury concept projects undertaken in the region, including Phuket, Koh Samui and Bali.

It said Malaysia was the only country in the region that does not have the boutique luxury concept developments, adding that concept projects in Langkawi would amplify the 5-year Langkawi Tourism Blueprint announced by the government to attract high net worth individuals to reside in Langkawi.

'Acknowledging the said potential of high-end boutique luxury mixed developments, DRB-Hicom via Rebak plans to develop villas and waterfront bungalow lots, commercial retail outlets and other required amenities on the undeveloped portion of Rebak Land,' it said.

DRB-Hicom said its future earnings were expected to improve taking into consideration the enhanced future development potential of Rebak Land, after the conversion, which would benefit the group in the long-term.

DRB Hicom to bank on M&A to drive future growth

SHAH ALAM: DRB-HICOM BHD [] will bank on selective mergers and acquisitions to fuel future growth, as organic growth was deemed to be too slow to realise its vision to become the top conglomerate in the country, said its group managing director Datuk Seri Mohamad Khamil Jamil.

However, he said any acquisition exercise that the group wanted to embark on should add value and be synergistic to its business model.

"When we acquired Pos Malaysia, many people said that the snail mail industry was a sunset industry. However, I look at the business opportunity that it presents to the group, with the network and areas that it reaches to," he said after its annual general meeting on Thursday, Sept 8.

Khamil said it would be synergistic to acquire PROTON HOLDINGS BHD [], as currently around 50% of DRB-Hicom's automotive sector revenue, which accounted for almost 60% of the group's revenue derived from the national car maker.

However, he said that after acquiring Pos Malaysia, the group wanted to first focus on realising the potential synergy in the group's operation by building a good business model to expand its operating profit.

He said DRB-Hicom plans to raise as much as RM1.7 billion in the next five years as the group embark onto the second phase of its five year growth plan which started in 2006.

The fund would be used to finance capital expenses such as to expand its automobile assembly plant in Pekan for the Volkswagen Passat assembly, a flagship campus of the international college of automotive manufacturing (ICAM) and to part fund the acquisitions of POS MALAYSIA BHD [], he said.

DHB-Hicom 1Q net profit falls 42% to RM91.07m

KUALA LUMPUR: DRB-HICOM BHD [] net profit for the first quarter ended June 30, 2011 fell 42% to RM91.07 million from RM157.78 million a year earlier on lower share of results of associated companies namely Honda Malaysia Sdn Bhd due to shortages of CKD packs following the Japan earthquake/tsunami in March 2011.

It said on Thursday, Aug 25 that its revenue for the quarter rose 1.93% to RM1.58 billion from RM1.55 billion in 2010.

Earnings per share declined to 4.71 sen from 8.16 sen in 2010, while net assets per share was RM2.63.

DRB-Hicom said that in the previous corresponding period, the group had recognised a one-off exceptional gain i.e. negative goodwill of RM71.22 million, arising from the accretion of equity interest in EON Bhd. Hence, profit reported during the period was RM223.48 million.

Reviewing its performance, DRB-Hicom group managing director Datuk Seri Mohd Khamil Jamil said the recent downgrading of the United States sovereign rating, European debt crisis, and the continuous increase in inflation would potentially affect the Malaysian economy.

Against this challenging background, the group would continue to pursue various cost management initiatives and review the group's business approaches to mitigate any negative and adverse impact on the group's financial results for the financial year ending March 31, 2012, he said.

Mohd Khamil however said that he was positive that the effects of the tragedy in Japan would not be a prevailing factor in the Group's future performances.

'This like most disasters was unexpected and unavoidable. Nevertheless, DRB-Hicom with its diverse business background is built to withstand various challenges thrown in its way.

'Despite the dip in the automotive sector's revenue, I am proud to say that the strategic re-alignment in our services sector over the last three years enabled the company to hold strong despite cyclical challenges,' he said.

Mohd Khamil said that with the completion of the acquisition of Pos Malaysia on July 1, 2011, it also meant that the group would be able to further push synergistic opportunities within the group and that this would eventually contribute positively to its future earnings.

''

DRB-Hicom explores merger of Bank Muamalat with Bank Islam, not sale plan

KUALA LUMPUR: DRB-HICOM BHD [] is exploring a potential merger of Bank Muamalat Malaysia Bhd and Bank Islam Malaysia Bhd but there are no plans to sell its shareholding in Bank Muamalat.

The company said on Friday, May 13 it had submitted a letter of expression of interest to BIMB HOLDINGS BHD [] (BIMB) to explore a potential merger of the two banks and 'has yet to commence any exploratory discussions with BIMB'.

DRB-Hicom is the holding company of Bank Muamalat and it holds a 70% stake while Khazanah Nasional Bhd owns the remaining 30%.

'The interest to merge is to add value and enhance the development of Islamic finance in Malaysia which continues to register strong growth over the years,' it said.

DRB-Hicom said the total assets of the overall Islamic banking sector (including development financial institutions) amounted to RM350.8 billion at end-2010, up 15.7% from 2009.

It added the Islamic banking sector (including development financial institutions) now accounted for over 20.8% of the overall banking system in terms of assets, financing and deposits.

'A proposed merger will witness the emergence of a mega Islamic bank and is in line with our government's call to reinforce Malaysia's position as a leading international centre for Islamic finance and to create a home-grown bank,' it said.

DRB-Hicom's Puspakom in MoU with govt for hire purchase inspection

KUALA LUMPUR: DRB-HICOM BHD []'s unit Puspakom Sdn Bhd has signed an MoU with the government to undertake the hire purchase inspection services for all vehicles.

DRB-Hicom said on Wednesday, April 13, the inspection services would be undertaken following the implementation of the newly amended Hire-Purchase Act 1967 (Amended 2010).

'The parties shall undertake the necessary steps to provide technical co-operation in various areas amongst others including the scope of inspection, method and preparation of inspection report, equipment and inspection facilities, and training and investigation,' it said.

DRB-Hicom said the hire purchase inspection would involve a 'Hire Purchase 7 Points Inspection Specification' on all motor vehicles sent to Puspakom.