FUND-RAISING EXERCISES TO MAKE CORPORATE SCENE MORE EXCITING

By Farazira Amira Yusof

KUALA LUMPUR, Dec 31 (Bernama) -- The Malaysian corporate scene will be more
exciting in 2010 as the excess liquidity in the system is expected to induce
more fund-raising exercises and see the emergence of new bigger players.

The strong capital market, liberalisation of foreign policies, the expected
rebound in the country's real gross domestic product together with the positive
domino effect from the region's economy and equity markets would be the main
drivers.

In 2009, numerous corporates took the opportunity to raise funds from the
capital market via rights issues or placement exercises.

For instance, Malayan Banking Bhd has completed the largest rights issue of
RM6.02 billion followed by Axiata Group Bhd, which raised RM5.23 billion.
(US$1=RM3.42)

Khazanah Nasional Bhd, Malaysian government's investment holding arm, also
placed out shares in PLUS Expressways Bhd, Malaysia's biggest highway
concessionaries, Malaysia Airports Holdings Bhd and CIMB Group Holdings Bhd.

Others included national carrier Malaysian Airline System Bhd, Sunway
Holdings Bhd, Scomi Group Bhd, IOI Corp Bhd and the IJM Corp Bhd.

"New placement and more fund-raising exercises in the equity market are
expected to further shine in 2010," an analyst from OSK Research, Chris Eng,
told Bernama.

The bond market, however, is expected to be quiet with fewer isssues
starting from the middle of next year as the interest rate is likely to rise.

On the initial public offerings, the proposed listing of government-run
plantation agency, Felda Holdings Bhd, which was mooted in 2003, is expected to
materialise under Prime Minister, Najib Razak.

Felda (Federal Land Development Authority) was the brainchild of Najib's
father, second Prime Minister Abdul Razak.

The market is also waiting for the potential listing of one of the
Petroliam Nasional Bhd's subsidiaries.

In 2009, the market saw the relisting of Maxis Bhd that raised RM11.2
billion, making it the biggest listing in South-East Asia after receiving a
total demand of RM26.5 billion. (US$1=RM3.42)

The listing signifies that the local market is relevant to big companies and
profiles Bursa Malaysia as an appropriate platform to raise fund.

Eng said the number of key reforms Najib had implemented had helped to
revitalise corporate Malaysia.

"While Malaysia has never pursued an isolationist policy, the efforts by the
current government in reaching out to its counterparts in Saudi Arabia, China
and Singapore are more high profile and pave the way for greater cooperation at
a corporate level.

"The revitalisation also provides a challenge for the government-linked
companies (GLCs) to scale greater heights. GLCs were making transformation
efforts to become regional and global players with encouragement from the
government," he said.

Analysts also expected rural infrastructure development efforts to pick
up pace in 2010 while larger contracts may see the light of day with alternative
funding sources becoming available, such as funds freed up by the relisting of
Maxis.

An analyst from Inter-Pacific Research Sdn Bhd, Anthony Dass, said more
merger and acquisition exercises were expected as asset prices remained at
reasonable level.

"Rumours are rife. We have to wait and see. Generally, the unprecedented
policies and stimulus fiscal measures have started to yield the desired positive
results and thus will spur the investment strategy," he said.

The purported Hong Leong Bank Bhd's takeover of EON Capital Bhd would
lead the domestic scene.

The market is also talking about the country's biggest fund manager,
Permodalan Nasional Bhd buying a property company.

Meanwhile, OSK Research said Malaysia has unique bullish drivers which came
in the form of an exodus of entrepreneurship.

"The exit of 'sugar king' Robert Kuok from the Malaysian sugar industry is
being viewed as a move to institutionalise some of the larger family-owned
entities in Malaysia.

"While the move to more institutional shareholders could be argued as being
better from the corporate governance standpoint, the cons of such move would be
that Malaysia might be deprived of the entrepreneurial spirit that has helped
drive the nation in the past," it said.

OSK said some quarters raised concerns that many private businessmen
preferred to invest overseas rather than seek further market opportunities
locally.

"While this is the flip side to the argument that we need more global
champions, we feel this is a longer term concern that warrants some attention
beginning from now," it said.
-- BERNAMA