PPB denies in talks to acquire MSM from FGV

It is reported that FGV is seeking a partner to strengthen MSM’s business and is talking to a few potential suitors

by SULHI KHALID/ pic by TMR FILE

PPB Group Bhd has denied it was in discussion with FGV Holdings Bhd to acquire a stake in the planter’s sugar manufacturing subsidiary MSM Malaysia Holdings Bhd.

PPB group MD Lim Soon Huat (picture) said the group has not approached FGV over any stake acquisition despite the latter is looking for a strategic partner and investor.

“I think it’s best to check with them (FGV), but I can confirm that PPB is not in discussion with FGV,” Lim said during the company’s briefing in Kuala Lumpur yesterday.

It was reported that FGV, which owns a 51% stake in the country’s largest refined sugar producer, is seeking a partner to strengthen MSM’s business.

A news report had suggested that FGV is talking to a few potential suitors. The news of a potential stake acquisition of FGV’s stakes in MSM drove the share prices of both companies.

Wilmar International Ltd was among the companies named as a potential suitor and PPB is the second-largest shareholder of Wilmar International, with an 18.5% interest in the company.

MSM holds about 59% market share of the local sugar market.

Meanwhile, PPB’s film exhibition and distribution segment via Golden Screen Cinemas Sdn Bhd (GSC) is looking to expand its entertainment businesses in Cambodia and Myanmar.

The group has an international presence in Vietnam through its 40%-controlled unit, Galaxy Studio. It targets to open 15 more in that country by the end of this year. Vietnam is one of the fastest growing economies in the region.

“The profit margins are higher in Vietnam as Malaysia imposed a high entertainment tax,” said GSC CEO Koh Mei Lee.

GSC, a 100% entity owned by PPB, recorded an 8% increase in revenue to RM274 million in the first six months of the year (1H19) due to the higher contribution from the distribution of Chinese New Year movies and local Malay titles, as well as the release of strong titles such as the Avengers: Endgame and Aladdin.

For the property division, the group has an 800-acre (323.75Sha) landbank in the northern region.

On the upcoming national budget, Lim said it hopes the government will recognise the sentiment on the ground and introduce policies which will stimulate the consumer spending.

“From our side, we are hoping for tax reduction as it will not only benefit the corporate and small and medium enterprises, but also ordinary people, especially the B40 (bottom 40%) income group,” he said.

PPB, controlled by tycoon Tan Sri Robert Kuok, is a diversified conglomerate with interest in grains and agribusiness, consumer products, film exhibition and distribution, and environmental engineering and utilities, as well as property development.