10 December 2008 Newz Bits

December 10, 2008 at 2:02 am Leave a comment

HIGHLIGHTS

On Malaysia
· Boustead Holdings Bhd will not fertilise its oil palm plantations in 1Q09 to cope with rising fertiliser prices
· MMC Corp Bhd may sell part of Port of Tanjung Pelepas to fund expansion plans
· Mulpha International aborts acquisition of coal mines
On The Global Front
· US housing markets fare better than expected in October
· Japan’s economy sinks deeper into recession in the 3Q than initially estimated
· International trade will shrink in 2009 for the first time in more than 25 years

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Boustead Holdings Bhd (BOUS MK, Buy, TP: RM4.00) will not fertilise its oil palm plantations in 1Q09 to cope with rising fertiliser prices and falling crude palm oil (CPO) prices. Its group managing director Tan Sri Lodin Wok Kamaruddin said it would resume using fertilisers for its plantations in 2Q. By controlling the use of fertilisers, planters are also able to scale back the production of fresh fruit bunches (FFB). (Financial Daily)
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Kumpulan Perangsang Selangor Bhd (KUPS MK, Hold, TP: RM2.10) has received minority shareholders’ approval to go ahead with its proposed acquisition of a 15% stake in Syarikat Bekalan Air Selangor Sdn Bhd (Syabas) for RM200m cash. KUPS’s acquisition of Syabas will be funded via RM50m borrowings and RM150m internal funds. (StarBiz)
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MMC Corp Bhd may sell part of Malaysia’s second largest container port to fund expansion plans, sources said. The group has received strong interest from local and foreign parties to buy a stake in the Port of Tanjung Pelepas (PTP). MMC now holds 70% of PTP, with the rest held by Danish shipping giant Maersk Line. Another source said an independent valuer has priced the port at around RM9bn. Assuming MMC sells a fifth of PTP at this value, it could raise about RM1.8bn. It would also still have control of the port, which is the 17th busiest container port in the world. Sources said that several large shipping lines including Taiwan’s Evergreen Marine Corp have made their interest known, while some local institutional investors are also in the running. (BT)
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Mulpha International Bhd announced that its 62.5% subsidiary, Greenfield Chemical Holdings Ltd, has terminated the proposed acquisition of 100% equity in Winfame Investments Ltd. In a filing to Bursa Malaysia, Mulpha said the conditional agreement was terminated due to uncertain demand for natural resources, including coal, amid the recent financial crisis. Mulpha said simultaneous with the execution of the deed of termination, relevant agreements were also signed to consolidate and restructure the total debt of HK$155m (RM70m) owed by the vendors. The debt comprised the deposit of HK$100m paid by Greenfield under the agreement and loans of HK$55m extended by the Greenfield group. It said the debt will be consolidated and assigned to New Gold, a 99.9% subsidiary of Winfame. The debt will be repayable at the end of two years
and may be extended for another year, it added. (BT)
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APL Industries Bhd (APLI) has deferred its restructuring plan pending an improvement in market conditions, but will embark on a comprehensive cost-cutting exercise that will include cutting down the number of its directors and shutting down a factory. Datuk Seri Stanley Thai, who resigned as APLI chairman and managing director yesterday, said while the group had obtained approval from the Securities Commission and shareholders to start a capital reconstruction and recapitalisation exercise through a rights issue, the group was deferring its plans in light of market uncertainties. Thai said the approval for the exercise was valid until June 12, 2009. He said APLI may turn to private equity funds to boost its working capital but declined to elaborate on potential partners. He also said Supermax Corporation will sell its 14.09% stake in APLI at an appropriate price of about 60 sen per share. His wife Datin Seri Cheryl Tan has taken over the helm at APLI until a new independent management team is established. (Financial Daily)
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Prime Minister Datuk Seri Abdullah Ahmad Badawi will not renege on his promise to vacate the premiership after the Umno elections next March, a source close to the premier said yesterday. According to the source, Abdullah is expected to hand over the reins of power to his deputy Datuk Seri Najib Razak within two weeks of the Umno polls. The actual handover might officially take place in early April, to give Abdullah reasonable time to vacate the position. (Financial Daily)
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Stocks retreated Tuesday, Dow Jones industrial average slumped 240 points or 2.7%. Stocks had been on both sides of unchanged through the session as investors digested the day’s batch of negative corporate news and kept an eye on the latest news on a potential automaker loan package. But stocks turned decidedly negative in the afternoon. An agreement on a loan package for the auto industry had been expected late Monday. But lawmakers were still debating the details Tuesday, with a package now expected Wednesday. (CNN Money)
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US housing markets fared better than expected in October. The number of homes under contract to be sold fell by just 1% year over year according to a report out today from the National Association of Realtors (NAR), and was down 0.7% from September. Analysts surveyed by Briefing.com had expected pending sales to slip by 3.6% year over year, and by 3% from September. Many of the one-time bubble markets in Florida and California are now showing substantial sale gains from their depressed levels over the past couple of years. Sharp price declines in these markets have attracted bargain hunting buyers. (CNN Money)
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U.K. manufacturing contracted almost three times as much as economists forecast in October and housing sales fell to the lowest in three decades, as the country slipped deeper into recession. Factory output fell 1.4% from September, the Office for National Statistics said. Economists predicted a 0.5% decline, according to the median of 22 forecasts in a Bloomberg News survey. Real-estate agents and surveyors sold the fewest properties since records began in 1978, the Royal Institution of Chartered Surveyors said. (Bloomberg)
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German investor confidence unexpectedly rose for a second month in December after the European Central Bank cut interest rates by an unprecedented amount and the government announced measures to bolster Europe’s largest economy. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations increased to minus 45.2 from minus 53.5 in November. Economists expected a drop to minus 57, according to the median of 38 forecasts in a Bloomberg News survey. (Reuters)
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Japan’s economy sank deeper into recession in the 3Q than initially estimated. Japan’s GDP contracted 0.5% 3Q, far more than the preliminary figure of a 0.1% decrease, revised GDP figures showed on Tuesday. The export-driven economy now looks likely to keep shrinking at least until the 1Q09 — which would mark a postwar-record four straight quarters of decline — as leading manufacturers slash output to deal with a slump in global demand. Some analysts speculate the Bank of Japan will cut interest rates again by March, the end of the business year, after lowering its key rate to 0.30% from 0.50% in October. (Reuters)
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China’s exports may have contracted last month as industrial output cooled. November industrial growth will be something around 5 percent and export growth will be negative, said Fan Gang, an adviser to the central bank. The government has already unveiled a 4trn yuan ($582bn) stimulus package and cut interest rates by the most in 11 years as a global recession reduces demand for toys, textiles and electronics. A decline in exports would be the first in seven years and increase the risk that the slowdown in the world’s fourth-biggest economy will become a slump. Inflation slowed in November for the seventh straight month, central bank statistics head Zhang Tao said at the forum. Prices may have climbed less than 3%, Zhang said.  Bloomberg)
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International trade will shrink in 2009 for the first time in more than 25 years as economic growth slows and commodity prices slide, the World Bank said. World trade volumes will probably contract next year by 2.1%, hampered by exchange rate volatility, flagging import demand and a decline in export financing stemming from the credit crisis, the bank said today in its annual Global Economic Prospects report. Gross domestic product in developing countries will increase 4.5% in 2009 compared with 6.3% this year, while global growth will slow to 0.9%, or the weakest rate since records became available in 1970, the World Bank said. (Bloomberg)
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28 November 2008 Newz Bits December 9, 2008 Daily Highlights

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