AK BUY OUT TANJONG IN ANOTHER US$1.47 BILLION LANDMARK DEAL

KUALA LUMPUR, July 30 (Bernama) -- Billionaire T. Ananda Krishnan in a
back-to- back deal is taking Tanjong Plc private by offering RM21. 80 (US$6.84)
per share which will result in a RM4.7 billion (US$1.47 billion) privatisation
deal mainly to spin off its power generation to grow it even bigger than what it
is Friday.

Two days ago, he privatised Measat Global Bhd for a cash offer price of
RM4.20 (US$1.31) or about RM668 million (US$209.7 million). This is the fourth
major corporate exercise in less than a year.

Tanjong Capital Sdn Bhd (TCSB), a special purpose vehicle set up by Usaha
Tegas Sdn Bhd, a consortium which collectively holds 46.96 per cent of the total
issued ordinary shares in Tanjong.

The consortium has given irrevocable undertaking that TCSB will accept the
offer.

"Based on the offer price of RM21.80 per Tanjong share, Tanjong is valued at
RM8.8 billion (US$2.76 billion), the minority shares are valued at RM4.7
billion," said CIMB Investment Bank CEO Nazir Razak.

CIMB Investment Bank and RHB Investment Bank are joint financial advisers
for the deal while Standard Chartered Bank and RBS Asia Advisers (Malaysia) Sdn
Bhd have been appointed joint financial advisers for TCSB for the offer.

The offer price represents a premium of 21.92 per cent over the closing
price of Tanjong shares of RM17.88 (US$5.61) per share on July 27, 2010. TCSB
does not intend to retain the listing status of Tanjong.

“The market is conducive for these deals. Once the intention to privatise
Measat was decided upon, I think it is in the best interest of corporate
governance. Also, to spare any speculation,” he said when asked on the
back-to-back deal.

Tanjong is an investment holding company whose subsidiaries are involved in
the businesses of power generation, gaming, leisure and property investment.

He said the Tanjong Group aspired to be a global player in the power
generation industry by pursuing development opportunities in the Middle East,
North and South Africa and South East Asia.

“Tanjong, as currently structured, will now have sufficient capital to
achieve this ambition and therefore "we need to be restructured and
recapitalised," he said.

The idea is to be substantially larger than what Tanjong is today, he said.

This is in order to meet the prospective, long-term investment and debt
profile
which will result in higher borrowing cost and translate to medium- term earning
volatility.

Additionally, TCSB believes Tanjong, which has a vast range of businesses
including power and gaming, suffers from conglomerate discount valuation.

Furthermore, Shariah-compliant and many Malaysia-based institutional
investors
are not able to invest in the Tanjong Group’s growing power assets, given the
gaming business of the Tanjong Group.

“A privatised Tanjong will enable the business to seek out long-term
capital providers, and where it serves the corporate objective, allow the
introduction of strategic partners on undertaking of broader partnership,” said
Nazir.

"The scale of growth that is being planned for the power generation segment
needs better capital, so better to go “private” and secure strategic investors,"
he said.

Nazir said it will cost US$1 million per megawatt for additional power, “so
if you translate that into the 6,000 megawatt that I mentioned in doubling its
capacity in the next few years, the fund that is needed is huge,” he added.

-- BERNAMA




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