Tuesday, November 28, 2006

Who Initiated This Mega-Merger? "Don't Bother About It" Says PNB Boss!

Permodalan Nasional Bhd (PNB) will support any kind of synergy that it believes will enhance efficiency and offer better value for the company, said its president/group chief executive, Tan Sri Hamad Kama Piah Che Othman.

He said PNB had undertook consolidations in the past, like the case of Island and Peninsular Bhd.

"So this (RM31 billion proposed merger between Sime Darby Bhd, Golden Hope Plantations Bhd and Kumpulan Guthrie Bhd) is not unheard of," he told reporters. "Maybe, this is the biggest so far because you are talking about three giants in the industry," he said.

Synergy Drive Sdn Bhd, the proposed special-purpose vehicle, would emerge as the world's largest listed oil palm plantation player if the deal, said to be the biggest in South East Asia, is successful. It would then be listed on Bursa Malaysia in place of the three companies which in turn, would be delisted.

Asked who initiated the merger proposal, Hamad said "Why so much interest in that. I don't think we want to bother with that. The most important thing is the result. We want to see enhanced economic value created."

He said post-merger, PNB would still remain as the major shareholder in the company. "Hopefully, we can better penetrate the world market in concerted efforts and get the market share we expect," he said.

According to Hamad, there would be cost-cutting measures to achieve a significant level of synergy.

"When you combine the resources as one effort and under one leadership, then you can see where you are going next. You can see we are quite big, but for world standard we are still small," he said.

Asked if there would be retrenchment of the 107,000-strong staff due to job redundancy, he said PNB would leave it to the boards of various companies to decide. "They will know more about the position and the impact on these people. The thing is when you are together under one roof, cost-cutting will come in handy.

"Definitely, we cannot have three research houses," he said. However, he said, PNB would not simply retrench the workers.


***** Shall we heed the word of the wise man from PNB and refrain from asking who initiated the merger, who stands to gain the most from this and who most importantly will lose? Who? Who? And who? I'm trying to second-guess here. Any bright spark out there with more than mere guesses and assumptions? The readers of this blog will be most interested to know.



Blogger Lin Peh said...

Looks like many peeples going to be out of job soon :-(

8:49 PM GMT+8  
Anonymous Anonymous said...

It is good for the economy if synergy improves efficiency and profits. I am glad that malaysia is moving towards free markets. A bunch of smaller inefficient companies just drains resources and cannot compete with larger rivals.

2:42 AM GMT+8  
Anonymous Anonymous said...

Horay! this is a perfect scheme to justify the continuation of NEP. Splendid!

7:54 PM GMT+8  

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