Sri  Mokhzani  Mahathir  and  his  close  associate,  Yeow  Kheng  Chew  have both resigned from the board of  SapuraKencana yesterday. In a filing with Bursa  Malaysia,  SapuraKencana  said  Mokhzani  stepped  down  from  his position  as  vice-chairman  due  to  personal  reasons.  In  a  separate  filling, Yeow also resigned as a non-executive director due to personal reasons. (Bursa Malaysia, The Edge Financial Daily)

Comments:  We  are  negative  on  the  resignations.  Operationally,  we opine that the changes would not have a material impact to the group's day-to-day operations  as  Mokhzani  and  Yeow  were  redesignated  to  non-executive directors  (from  executive  directors)  back  in  end-Dec13.  That  said,  the resignations are, in our view, slightly detrimental to SapuraKencana's long term competitive edge and importantly, it may trigger  a potential disposal of Mokhzani  and  Yeow's  indirect  holding  of  610m  SapuraKencana  shares (10.4% stake), held via Kencana Capital and Khasera Sdn Bhd. No change to our BUY rating and TP of RM2.60 for now.

Source: Affin Hwang Capital Research - 5 Mar 2015