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Stocks In Focus MY (Eco World Devt Group, MyEG, Perwaja Hldgs) – 11/05/15
Eco World Development Group Raises RM638m
Eco World Development Group has raised RM638.4 million from the placement of 394 million new shares.
The placement attracted strong demand from domestic and foreign investors with the order book being subscribed by 1.4 times over the total number of new shares available for subscription.
Total proceeds raised from corporate exercises from the placement, the share subscription and the rights issue with warrants completed earlier amounted to RM2.8 billion.
Significance : Eco World states that the proceeds would be substantially used to fund the acquisitions and future land acquisitions and investments, in line with the group’s growth and expansion plans.
MyEG In RM155m Property Deal
My EG Services (MyEG) is acquiring 22 storeys of stratified parcels in the 45-storey Iconic Office (Block N) at Empire City @ Damansara for RM155.4 million.
MyEG had entered into 22 conditional sale and purchase agreements with Cosmopolitan Avenue as part of its plan to centralise its operations and relocate all employees.
MyEG states that the market outlook for property, specifically the office market was expected to remain resilient with stable occupancy and rental rates.
Significance : The proposed acquisition facilitates the company’s plans to centralise its operations and relocate all employees under one roof to improve efficiency and operational productivity as it experienced growth in its business, operations and staff strength.
Perwaja Plant Receives RM300m Investment
Perwaja Holdings may be receiving up to RM300 million over 18 months from Tianjin Zhi Yuan Investment Group.
Higher than the previously announced amount by RM100 million, the amount is for the lease of the property and restarting of Perwaja’s existing facilities.
Additional funds are for modification of equipment and new machinery to produce alloy products, with hopes of producing up to 800,000 tonnes of alloy per year.
Significance : There is a glut in steel supply and stiff competition has depressed steel prices. Perwaja’s plan is to move upwards to higher value alloy and steer away from traditional steel business.
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