Maxis is Coming (back) to Town but are Investors Excited?
More than two years ago Ananda Krishnan, a self-made billionaire who controls Maxis Communications, Tanjong Plc, Measat and Astro dropped the bombshell to take Maxis private and almost instantly raised eyebrows of millions of investors. Many Maxis investors back then was furious with the privatization plan simply because it disrupted their long-term investment plan – good dividend from a good organic-growing and well-managed telecommunication company. Ananda offered RM15.60 per share (inclusive of RM0.30 per share dividend) for all the minority shareholders, a 20% premium to the last-traded price of RM13.00 a share before the announcement to take the company off the stock exchange.
The 71-year-old media mogul is also reportedly toying with the plan to buy English football club Newcastle United for £80 million, a deal represents loose change to the tycoon. Ananda, whose family originates from Jaffna, Sri Lanka, is the third wealthiest man in Southeast Asia behind Robert Kuok and Ng Teng Fong and was reported to be the wealthiest Tamil in the world. His purchased of 46% of Maxis Communications from British Telecom and AT&T for $680 million thus raising his stake to 70% must be one of his greatest business decisions to date.
When Ananda decided to take Maxis private more than two years ago, the minorities were mad because they believed Ananda shouldn’t promised them the sunshine pre-listing but after using their monies to expand the company, the minorities were told to get out. But the tycoon was said to be sulking because the stock price did not reflects the actual value of the company hence the privatization. Compared with government-controlled Telekom Malaysia (KLSE: TM, stock-code 4863) (mobile player Celcom was part of Telekom) and Telenor’s DIGI.com Berhad (KLSE: DIGI, stock-code 6947), Maxis was trade at the lowest P/E (price to earnings) ratio. But investors preferred Maxis because DIGI.com was too expensive while Telekom was too crappy *grin*.
There were also other speculations as to why the sudden exit from the local and institutional’s funds. Just like Genting Berhad, Ananda was said to be cautious with the previous Badawi’s weak and auto-pilot administration especially in the economic sector hence the next logical thing to do was to exit the listing status in order to ease his fortunes relocation elsewhere. However one cannot deny the fact that the telco market was already reaching saturation level and it was none other than DIGI.com that was the leader in “price-canabalizing” which frustrated Maxis very much then. In reality Ananda was obsessed with India and Indonesia markets so much so he can’t wait to inject these overseas’ operation with cash. But his voyage into the Indonesia (PT Natrindo Telepon Selular), India (Aircel Ltd.) and Sri Lanka’s soils were not easy particularly in India due to this Jaffna Tamil roots.
It’s interesting to read that Maxis plans to re-list again in the local Kuala Lumpur Stock Exchange. But what makes everyone puzzling was the way the news was announced – the Prime Minister Najib Razak seemed very eager to get the telecommunication giant listed once again. You may see it as an endorsement to Maxis’s intention to list and in the process scoop the public monies but what about its’ foreign operations? Maxis commanded about RM40 billion in market capitalization before delisting from KLSE and that’s a lot of money. But why relist now when Maxis was adamant to pull out two years ago? Could there be an agreement between Maxis and the Malaysian government to create a win-win solution?
Maxis may be a darling company but Ananda has learnt that it’s still a long journey to make it big in India’s market. Maxis plans to invest $5 billion more in its Indian joint venture, 75% stake in Aircel Ltd., to expand the mobile service provider's network after spending $5 billion for the current fiscal year ending Mar 31. With the ambition to offer 3G in India, Maxis’s needs huge amount of money and every billions of dollars count so where else do you farm for money if not Malaysians? Competition is tough in India – while Maxis was trying to establish its foot-print, player such as Bharti is already talking about a merger of its India’s Airtel and South Africa’a MTN (largest cell-phone operator in Africa), creating world’s third largest telco in terms of subscribers. Bharti Airtel and competitor Reliance Communications have been cutting each other’s throat in their fierce fight for subscribers.
Most Indians who can afford cell phones have already signed up with Airtel, Reliance or other rivals but with the cheapest rates in the world, the fight is for the rural customers. But to build new towers just to win customers who may generate $10 a month in revenues is a tough battle for big boy like Airtel who has about 100 million Indian customers, what more to new comer such as Maxis Communications. In order to survive the harsh environment especially in the 3G market naturally Maxis has to turn back once again to Malaysian investors for funds – lots of it.
On the other hand, PM Najib was having tough time convincing foreign investors to park their hot money in Malaysia despite the much trumpeted 30% stake abolishment (certain sectors only) in mandatory Bumiputra stake. But most foreign investors are adopting wait-and-see attitude towards the latest news due to the frequent flip-flop in government policies. Najib’s mentor, former PM Mahathir, didn’t help the situation when he once again played the racial card claiming that the Malays (or rather UMNO?) are still very far away from owning the targeted stake and the Chinese was the actual master in Malaysia. But youngsters and the educated ones know Mahathir’s comment was obsolete but such comment was enough to convince foreign investors that UMNO-led government is still very risky a governement to trust, at least for the time being.
Thus, the story to get Maxis to be re-listed by Najib was a clever way to attract foreign or institutional funds. Nevertheless assuming that it was true that Maxis is to be re-listed end of the year 2009, will the investors equally excited about the story, the same way Maxis was listed in 2002 with the IPO price of RM4.85 (institutional) and RM4.36 (retail) a share respectively? Obviously Maxis cannot demand the same valuation for the listing since the risk factors have increased since then. But barring any sudden tumble in Dow Jones now is perhaps the best time to test the water with Maxis relisting story. So far, local IPOs have been very disappointed and Maxis may be the only candidate to reverse that. Again, another party to benefit from Maxis relisting (end of the year) is definitely PM Najib’s own brother, Nazir Razak, because the underwriter for such a massive IPO (speculated in Oct 2009) is none other than CIMB Investment Bank.
Other Articles That May Interest You …
- No 30% stake for bumiputra but are you taking the bait?
- iPhone slashed to $99, Faster 3G S Model
- PM Najib’s Cronies and their Related Companies
- Hey Mr. PM Badawi, I have an Apple iPhone too
- The Rise of CELCOM Empire, Tales You Should Know
- Ananda Made Instant Profit from 25% Sold to Saudi
- Privatization Gaining Momentum - Junk Stocks Left
- MAXIS Delisting – Good News for DIGI and TELEKOM Stocks
Stumble it!
Friday, July 24, 2009
Short Videos from TVB that You May Have Missed
Someone forwarded the link to below video published on YouTube some months ago. I'm not sure if you've missed this but I sure did. It seemed the Mar 2008 general election caught the attention of Hong Kong TVB as well but for obvious reason you won't be able to watch it even though you subscribed to Astro. Fortunately there was English subtitle included.
Saturday, July 18, 2009
Now I bet you would like to welcome Badawi back as PM
Someone commented that I should shut-up and give Najib’s administration an opportunity to perform hence I shouldn’t be so negative about the current ruling government. Maybe this guy/gal did not have the opportunity to visit the infamous MACC (Malaysian Anti-Corruption Commission) office and tasted a cup of their aroma coffee. I wonder if this smart fellow would sing the same song of praise for Najib if he was humiliated, his/her loved ones threaten, made to stand for four hours and numerous other interrogation techniques used by MACC. That’s right – Najib’s 100-days were full of promises *applause* but thereafter (post 100-days) scored the first death in the hand of MACC.
All of a sudden the whole episode made you think if MACC consists of thugs, the same league as the Royal Police force. Maybe both MACC and the Police are racing against time to show who is the best in their interrogation techniques; hoping to win applauses from Najib’s administration. But wait, I shouldn’t be so negative because it was not Najib’s fault that MACC used such technique and in the process caused the death of a soon to be father (political secretary to a Selangor state executive councilor) Teoh Beng Hock. It wasn’t Najib’s fault in the first place that such stupid MACC officers were recruited. But a baby is set to arrive to this world without a daddy and that’s sad. To tell the baby later that his/her father was threatened and “accidently” murdered by a bunch of supposedly anti-corruption officers is beyond words.
Suddenly you may think and hoped that Abdullah Badawi was still the Prime Minister. Sure, he slept on the job but at least he did that openly and never hides about it. But now you’ve a new Prime Minister whose policy amongst others encourage and adopt dangerous intimidation and interrogation style that could cause deaths. Which would you prefer – a boring or a hellish administration? In reality there was no death under Abdullah Badawi’s administration (under anti-corruption) but now the country is entering an era where one’s life is so cheap that throwing you out of the window is like throwing a piece of tissue paper *gulp*. Perhaps those morons who still think Najib’s administration is still finger-licking good should tell that to the face of Teoh Beng Hock’s fiancée, 28-year-old teacher Soh Cher Wei who was two-months pregnant.
To deny the fact that the current MACC is mirroring the thuggish police and has nothing to do with Najib’s administration is an under-statement. The fact that Najib’s administration was quick to warn everyone not to link the death (Teoh Beng Hock) to MACC was sufficient to show that the current intimidation, threat and physical torture policy of the current government is set to continue and most likely flourish, whether you like it or not. The ball is now in Najib’s court. You don’t think MACC’s latest action in targeting the opposition parties was done without the endorsement of Najib’s administration, do you? If you still think Najib’s administration is as clean as babies’ diaper *yuck* then you’re a moron, stupid and deserve to be rape by the current government.
Unless Najib give instruction in bringing the real culprit(s) to face the music the perception of the public will remains the same – Najib’s administration is involving in the murder of innocent citizen. But knowing how the ruling government works, this murder case will be stamped with “No Further Action” and everything will be business as usual until the next unfortunate person experiences the Malaysian style’s bungee-jump again. Najib has to do the right thing and that is to come clean with the murderer, there’s no two ways about it. And to the oppositions who cries for Royal Commission – please shut up because it has been proven many times that Royal Commission is another toothless and powerless get-together-and-have-coffee session. There’s nothing special with that “Royal” word anymore. If Badawi is still around maybe this poor chap will not die so cheap but then both Badawi and Najib are still the same product coming from the same factory *sigh*.
Other Articles That May Interest You …
Thursday, July 16, 2009
BN is set to win Big, so buy political-linked stocks
Going by the rate on how Pakatan Rakyat is progressing since they unexpectedly upset the ruling government Barisan Nasional in the general election, chances are high that it’s game over for the Pakatan. It may be true that a “new wave” is set to sweep the nation under the leadership of PM Najib Razak, at least the result from the just-concluded Manek Urai by-election shows so. Najib’s 100-days in the office slogan and policies are working and it seems the youngsters are impressed with a prime minister who doesn’t sleep on the job. At minimum retail stock traders are extremely pleased that the local stock market was and is performing despite the ups-and-downs on the Dow Jones’ trading floor.
Opposition party PAS may have won the Manek Urai by-election with very much reduced majority and is free to point their fingers at free-flow of RM500 per vote practiced by Barisan Nasional during the by-election. They can claim Najib’s administration is playing dirty but hey, since when did BN play clean? PAS and Pakatan have nobody to blame but themselves. PAS members were the one who voted the so-called moles or traitors (president and deputy president) who have been causing the split in the party now. Najib didn’t sweat much in giving Pakatan the headache in losing the peoples’ support. Already the PAS and DAP have started their own civil war and canabalizing each other, much to the delight of Najib’s administration.
People’s are frustrated hence the message from the Manek Urai by-election. Frankly you don’t have to be a brain surgeon to predict that BN will win back it’s two-third majority come next general election should PAS, DAP and PKR continue with their current childish game. In reality PKR, PAS and DAP are still novice and couldn’t match the cunning BN in terms of dirty politics, what more with all the supports from military, police, election commission, anti-corruption agency and whatnot. Yet PKR, DAP and PAS thought they’re invincible and still fantasizing they would form the federal government come next general election.
Ruling government was openly giving away free money for votes. Police was used to frustrate opposition supporters. Election commission was creative enough to dump ballot boxes that contained votes not in favor of BN into the sea. Now, even anti-corruption agency is used to intimidate opposition parties to the extent that an exco’s political secretary (Teo Beng Hock) could mysteriously plunged to his death from the anti-corruption agency building. Instantly Minister in the Prime Ministers Department Nazri Aziz cautions anyone against pointing their finger at the death. Heck, you put a non-suspect into interrogation process right into midnight until 4:00am and suddenly this “witness” was found death and you have the cheek to threaten anyone against suspecting foul-play?
Sure, maybe this witness who was supposed to be married tomorrow suddenly found the urge to commit suicide because he was on ecstacy so it’s not MACC’s (Malaysian Anti-Corruption Commission) fault that he chose to perform the stunt from the HQ’s building. But then who can do anything to the MACC who is immortal and untouchable? They’re at the instruction of those who walk the corridors of power. And you’ve these small kids (PKR, DAP and PAS) fighting over small matters and trying to show off their new-found powers. Maybe it’s destiny that BN will rule this land for another 50-years after all. So cheer up and open your arms to welcome the hike in transportation fees and soon many more hikes.
So, what are you waiting for? Start grabbing all those political-linked stocks *grin* because the BN will win big in the next general election. It’s impossible to imagine BN will hand-over their power to the opposition without a fight, assuming that the opposition may win miraculously. There’re just too much to lose for the BN to give-up their key to the nation’s coffer.
Other Articles That May Interest You …
Sunday, July 12, 2009
Najib’s 100th Day – New Promises? Just Shut-Up, Please
President Obama shot down the idea of a second stimulus package, something which many had speculated thanks to the suckers’ rally that has lost its steam, clarifying that the first stimulus should be given time to show its effect. Obama urged Americans to be patient as his economic recovery plan was designed to work over two years *gulp*, not four months. Unfortunately more than two million jobs have lost and Americans continue to suffer. Naturally the Republicans took the opportunity to criticize the president and said the first stimulus has theoretically taken US$10,000 away from every American household to bailout companies but in return Americans do not feel a dollar richer.
During such critical stage, Obama did the right thing by setting the right expectation in explaining to the voters that the economy will not get any better soon, at least not within two years. If the president needs to maintain the trust of Americans, he has no other choice but to tell the truth. The earnings season which will kicks into high gear next week will be the immediate yardstick in measuring the health of American companies since the first stimulus package. You don’t make empty promises you can’t deliver especially if you’re the President of the United States of America. Time will tell if Americans will handover another four years to Obama after his first term.
Former Malaysia Prime Minister Abdullah Badawi learned the hard way when he over-promised the voters and as a result lost heavily in the Mar 2008 general election. Badawi was further humiliated when he was forced out of the office by none other than his own deputy, Najib Razak, who today made a series of “sweet” promises in conjunction with his 100th day as Prime Minister. As anticipated all the government-controlled newspapers sing the song of praises to Najib and all the ministers did the standard operating procedures (SOP) – Najib is the best and Najib is the greatest hero since the creation of Superman *yawn*.
Najib announced that road users will enjoy 20% discount if they pay toll more than 80 times per month. Whoa! This is indeed the greatest mankind invention since bread and compass. It beats me why only motorists who pay more than 80 times per month will enjoy the pathetic 20% discount when in fact the parasite concessionaires who are sucking the average-Joes money everyday due to extremely lopsided agreement should be stopped since the first day Najib took office. Of course we know that these concessionaires are actually the right-pocket of Najib’s administration (UMNO) so to buy over the roads actually means to slaughter the goose that lays golden eggs. Coincidently according to a poll by Merdeka Center, Najib’s popularity has skyrocketed to 65% from a mere 42% just before he became the country’s sixth prime minister.
Let’s give him the benefit of doubt and his approval rating has indeed climbed to 65% currently. No doubt he’s a better prime minister than his successor Abdullah Badawi. Opposition parties PKR-DAP-PAS should take this seriously and work doubly hard to ensure continuous support from the voters. Already the people have seen the benefits of having a strong opposition to check and balance the corrupt ruling government. But could the 65% approval rating was due to the fact that the poll was carried on fence-sitters who naturally gave the thumbs-up compared to Abdullah Badawi who slept on the job most of the time? Even Najib’s mentor, Mahathir, admitted the prime minister scored some points because he (Najib) doesn’t sleep on the job *grin*. Perhaps Najib should call for a state-level election for Perak as his 65% populatiry could now translate into a sure-win election.
Najib also promised he would improve crime problem and combat corruption *yawn again*. Maybe the prime minister was trying to insult the peoples’ intelligence once again. If he was serious about tackling the crime problem, the least he can do was to get rid of the current Inspector General of Police and appoint another person who can dedicate his or her time in crime prevention. We don’t need a police chief who would not think twice about assaulting the public over wearing black shirts or pulling a supposedly respected House Speaker as if he (Speaker) was a dog. The IGP must be made to understand that he survives on taxpayers’ money and not the prime minister’s money. If Najib was serious about combating corruption, maybe he should put former transport minister Ling Liong Sik and Chan Kong Choy on trial over PKFZ RM12 billion’s scandal. If my neighbor’s dog could smell something fishy about these two former transport minister, certainly a prime minister who enjoys 65% approval rating knows these two individuals are not angels after all.
Perhaps Najib should, for once, get the police and anti-corruption to check on Selangor former Chief Minister Khir Toyo’s claim that his controversial mansion costs only RM3.5million. If his mentor Mahathir is not convinced about Khir Toyo’s story, definitely you don’t expect us to believe him too, do you? I believe people will throw at least 80% of their support to Najib’s administration if he can show at least the political will on the issue of crime and corruption. Hence to promise quality of life, quality of education, better rural infrastructure and public transportation are not necessarily. It would be miracle if he can focus on the main problems – crime and corruption. So don’t over-promise because people are not stupid, not that they expect Najib’s 100th day of goodies is something which are achievable in the first place. We’ve enough of Barisan Nasional’s slogans thus Najib would do the people a great favor if he could just shut up.
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Sunday, July 05, 2009
No 30% stake for bumiputra but are you taking the bait?
I’ve just returned from a short trip to Singapore. As usual the hotels will be jacking up their rates come the Formula-1 again. Staying at 5-star (that was what my friend claimed) InterContinental Singapore at S$200 a night was a steal considering the cleaniness and spaciousness of the room. Broad-band was provided complimentary although I still can’t figure out why the hotel management could not provide a single bottle of mineral or distilled water as part of the service. Maybe they thought I can just walk to the Cold Storage which was a walking distance to get it. But I’m sure any travelers would prefer at least a bottle of distilled water that costs S$0.60 at the Cold Storage than a hand-written welcome note from the hotel management.Anyway I found out the food in Singapore is getting better thanks to many Malaysians who travel daily (I bet many of them have actually become citizens) to work on the island. My friend took us to try some of the Singapore foods which turn out to have similar taste compared to Malaysia. After some conversations it seems many restaurant owners or their workers are Malaysians so it seemed they have taken the advice from some of Malaysian politicians (current government) to go back to China, India and wherever their father or grandfather came from, if they are not happy with the racism policy the BN government is practicing. But instead of going back to China or India as threaten by these politicians, the Malaysian Chinese have migrated to Singapore instead.
One of my friends who were having dinner with us was actually a Malaysian. He decided to accept the Singapore citizenship after much considerations and he has never look back. He’s now attached to a MNC company in Singapore and the reason he chose Singapore was the fair opportunities and better education system for his children although he missed the durians a lot. Another pure Singaporean friend was super-excited when I shared with him the latest political happenings in Malaysia although I’ve to admit he seems to know a lot about Malaysian politic – ever since the opposition parties captured the developed states previously controlled by BN government.
He even told me that Lee Kuan Yew was actually neutral with a slight preference towards the opposition parties (at least that was what he claimed) and his recent visit to Malaysia that received extraordinary welcome by Najib’s administration confirmed my theories that the grand old man was there to smell the ground or peoples’ majority support. Based on the Singapore medias writeup it was obvious that Lee Kuan Yew was ready to accept a new government should the people decide to kick Najib out of the office – that is if certain stupid PAS leaders stop hurting the partnership with DAP and act quickly enough to cut the cancerous cells from PAS such as those who seemed to have been bought over by UMNO.
If a normal Singaporean could tell me that such PAS men have been bought over to create troubles within PAS, you don’t think the latest fiasco about UMNO-PAS joint-government was a gimmick, do you? Well, maybe it was deliberately done to such scale as to warn Anwar that the prime minister office does not belong to him but the damages done was too great. And now you have the latest fiasco in Kedah. However the Singapore government has not decided whether to pump in huge money into the so-called Iskandar Development Region, not after the police blatantly pulled the Speaker out of the House. But I argued (with a grin) that Najib has just announced that business owners do not have to give away 30% stake to the bumiputra. Of course my Singaporean friend smiled back at me and said that if Malaysians are not stupid to fall into such temporary policy, surely the Singaporean are way smarter than us – to which I can’t help but laughed.
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