By Stella Goh
 

Marine & General sells 40% stake in unit to MUHIBAH to settle outstanding sum

Marine & General Berhad (M&G) sold its 40% stake in wholly-owned subsidiary M&G Sutera 8 Sdn Bhd (MGS8) to MUHIBAH for RM21.84 million in order to settle the remaining outstanding sum owed to MUHIBAH for the construction of a chemical tanker, JM Sutera 8 (JMS8). Upon completion, M&G owns a 60% equity interest in MGS8. MGS8 is principally involved in the transport of freight overseas and coastal waters and other service activities incidental to water transportation.
 

Muhibbah Engineering (M) Berhad’s Airport Business takes 4 years to recover

MUHIBAH expects it will take 3 to 4 years for Cambodia’s airports to return to pre-epidemic levels. According to the group’s Managing Director Mac Yin Boon, the Cambodia’s airport passengers could reach 4.6 million this year, or 40% of the total passenger flow in FY2019.

MUHIBAH with 21% stake in Société Concessionaire de I’Aeroport (SCA) has exposure to three airports in Cambodia will end in FY2040. According to Kher Times, there are 30% of new Phnom Penh International Airport, built by the Cambodian Airport investment company (a local consortium and the civil aviation secretary’s office). Has invested US$1.5 billion (About RM6.3 billion). According to Mac Yin Boon, the company had not been informed of potential changes in the airport franchise so far. The company does not see any reason to terminate the agreement. In case of termination, the company will seek legal means to protect its rights and interests.

If the operation right is terminated earlier, the profit will be affected

The company still expects the rights to end in FY2040. Even if the right to operate is terminated, it is expected to be compensated. The contribution of the airport business accounted for a higher proportion of profits, and it is expected to impact the profits if the operation right is terminated early.

The engineering company is still trying to bid for the franchise business, which is stable and recycling revenue. The company is also looking for opportunities in Qatar, which continues to invest in its oil and gas business.

The company holds RM1.4 billion in orders, will be able to earn money in FY2023. Based on the immediate challenges, the company’s top management has cut salaries by 30% this year. As for dividend, it will depend on the future financial performance.

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