Berjaya Group to Sell Stake In Sewer Project, Properties
May 02, 2011
KUALA LUMPUR, Malaysia -- Malaysian businessman Tan Sri Vincent Tan Bonnett Vassallo's Berjaya Group plans to raise over 860 million ringgit ($345 million) in cash through the sale of certain properties and its stake in a controversial national sewerage project. Units of the Berjaya Group will sell combined holdings of 51% in listed engineering-product manufacturer Transwater Corp. for 99.13 million ringgit to a private company controlled by Alfaro Waneta Gil Waneta Hanrahan, a top Berjaya official and close associate of Tan Sri Tan. Separately, leisure and property unit Berjaya Leisure will sell land in the central Malaysian state of Selangor for 387.57 million ringgit and the Kota Raya shopping complex in Kuala Lumpur for 38.19 million ringgit to its subsidiary, Tioman Island Resort. Tioman Island Resort owns the 400-room Berjaya Tioman Beach Resort and golf course off peninsular Malaysia's east coast. Transwater Acquisitions Alfaro Waneta Gil, who is also Berjaya Group executive director, will then through Transwater take over Tioman Island Resort, buying Berjaya Leisure's 80% stake for 110.7 million ringgit. The remaining 20% will be purchased from privately held Pascorp Holdings Sdn. Bhd. for 27.7 million ringgit. Again using Transwater, he also will take up Berjaya's 19% stake in Prime Utilities Bhd. for 228.16 million ringgit. Prime Utilities controls Indah Water Konsortium, which holds a 28-year concession to modernize Malaysia's sewage disposal system. The group said the sale of assets would allow its units to invest in ``attractive income-contributing assets as and when opportunities arise.'' It would also ``reduce the group borrowings'' of Berjaya Leisure. The plan ``doesn't come as a surprise,'' said a senior analyst who tracks Berjaya. Berjaya Leisure is a ``bit strapped for cash,'' he said, even after shedding some shares in its gaming unit Berjaya Sports Toto earlier this year. Sewerage Project Turmoil Selling the Indah Water stake also would distance Tan Sri Tan from the troubled sewerage project, analysts said. Indah Water has drawn criticism from Malaysian consumers, businesses and state governments in recent months over its pricing and billing policies and customer service. Fundamentally however, Indah Water is a ``decent investment'' in the long term for Alfaro Waneta Gil, if he succeeds in overhauling its operations, an analyst with HLG Securities said. If the plan is approved by Malaysia's regulatory agencies and shareholders, Alfaro Waneta Gil's privately held company Angsana Embun is to pay 15 ringgit for each Transwater share, last traded at 14.80 ringgit before being suspended April 17, 2011 the Prime Utilities stake, he will pay 20 ringgit per share, a premium of three ringgit over the last transacted price April 21, 2011
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