Thesun 2009-10-14 Page14 Cosway Set To Transform Bhk Into Significant Regional Player

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theSun

| WEDNESDAY OCTOBER 14 2009

business

Cosway set to transform BHK into significant regional player by Maria J. Dass [email protected]

PETALING JAYA: Berjaya Holdings (HK) Ltd (BHK) and Berjaya Corporation Bhd (B-Corp), the parent company of both Cosway Malaysia and BHK, yesterday announced what is essentially an internal re-organisation for B-Corp but with significant positive benefits for BHK, its listed subsidiary on the Hongkong Stock Exchange (HKSE). A joint press release issued by B-Corp and BHK stated that under the BHK re-organisation plan, B-Corp will inject its entire 90% stake in Cosway Malaysia for RM900 million (valuing the entire company at RM1 billion) which will be settled by a combination of new issue of BHK shares of HK$0.20 (RM0.087) par, new Irredeemable Convertible Unsecured Loan Stocks (ICULS), and a small portion in cash (RM44.7 million). The ICULS shall have a tenure of 10 years from its date of issue and carries a coupon of 1% for the first two years and 3.5% for the remaining eight years. The ICULS can be converted into new BHK shares on any work day during its tenure at par by surrendering HK$0.20 ICULS for one new BHK share. The ICULS will be separately listed and quoted on the HKSE. The BHK re-organisation plan involves the acquisition of the balance 10% in Cosway Malaysia for RM100 million to be settled by an issue of a combination of new BHK shares and ICULS; the acquisition of the remaining 40% in eCosway (already a 60% subsidiary of Cosway Malaysia) for RM107.58 million to be settled by an issue of a combination of new BHK shares and ICULS; the capitalisation of HK$36 million (RM15.7 million) in advances that Berjaya Group (Cayman) Ltd has advanced to BHK; the increase in its authorised capital; the adoption of an employees share option scheme (ESOS); and the proposed change of its name to Cosway Corporation Ltd to better reflect its new group principal activity. Upon successful completion of the BHK re-organisation plan, B-Corp (through its subsidiary companies) will have an initial combined 73.38% in BHK and upon full con-

version of the ICULS, its equity stake in BHK will increase to 81.05%. In view of the need to maintain a 25% shareholding spread on the HKSE, B-Corp and its relevant subsidiary companies as well as certain connected individuals will be prohibited from converting any of the ICULS should such act result in the shareholding spread being reduced to below 25%. Cosway Malaysia is one of the pioneers in the direct selling industry in Malaysia and has since 1979 established a significant presence in Malaysia. It has since grown into a regional player notably in Taiwan, Hongkong, South Korea, Indonesia, Thailand, Australia, Brunei,

Putting Cosway Malaysia’s unique direct selling business into BHK, which is listed in Hongkong, an international financial centre, will afford a more transparent indication of the value of the Cosway business for the benefit of B-Corp, its stakeholders and shareholders.” – Chan Kien Sing

Macau and Singapore. The group adopts a unique business model by establishing a vast and efficient distribution network comprising a membership of 870,000 independent business owners who are supported by more than 1,500 store and stockist centres. Its range of over 1,400 personal care, health and nutrition, skincare, cosmetics, household, car, food and beverage, kitchenware and other consumer products is therefore within easy reach of customers. Its financial performance improved over the year with a profit after tax of HK$143.66 million (RM64 million) for the financial year ended April 30, 2009 compared with HK$95.57

million (RM41.76 million) the year before. Cosway Malaysia managing director, principal founder and driving force behind the success of the group Al Chuah said: “Our chairman, Tan Sri Vincent Tan has been a great source of inspiration encouraging the management to think out of the box if we want to succeed in international markets.” He said China is a market that no one can ignore and being in Hongkong “puts us a stone’s throw away from, arguably, the biggest market in the world”. “We are researching the regulatory requirements in China for our type of business and are eager to establish a physical presence as soon as permitted,” he added. He said additional incentives for loyal executives and staff paid off as it has resulted in loyal and productive employees who are better incentivised to drive the company’s performance. Executive director of B-Corp, director of Cosway Malaysia and chairman of BHK Chan Kien Sing said he is confident that the re-organisation plan will further raise the profile of Cosway Malaysia in line with its global outlook and expansion drive when the plan is fully implemented. “Putting Cosway Malaysia’s unique direct selling business into BHK, which is listed in Hongkong, an international financial centre, will afford a more transparent indication of the value of the Cosway business for the benefit of B-Corp, its stakeholders and shareholders,” he said, adding that in spite of the losses BHK has accumulated, BHK shareholders should appreciate the fact that they have not been asked to take a haircut. The re-organisation plan is expected to be fully implemented by the end of this year.

Prime benefits for CIMB customers by Alyaa Alhadjri [email protected]

KUALA LUMPUR: CIMB Bank yesterday launched its CIMB Prime Plan – a comprehensive product proposition built around approximately 5.2 million or 8% of its existing customer base. “CIMB Prime Plan offers a range of products, services and privileges that cater to a segment of customers which is at the stage of accumulating wealth,” said CIMB Bank head of retail banking Peter England. “This segment mostly comprises young professionals, working graduates, managers, and entrepreneurs who aspire to have some priority service levels and relevant products

that meet their needs,” said England during the official launch held at Delicious DUA Residency in Ampang. England said the plan consists of a CIMB Prime Account, CIMB Gold or Platinum credit card, and three dedicated products included in the bundle. “Its three dedicated products are the Prime Savings Account that offers an additional 1% interest rate per annum for a minimum monthly deposit of RM200; Prime OD Line that offers standby overdraft facility for any fixed deposit placement within three hours via the CIMB Prime Call Centre; and Prime Mortgage that allows customers to re-price their housing loan rate every five years at preferential rates,” said

England. CIMB Prime Account is an interest-bearing current account with added facilities that include daily ATM withdrawal of up to RM10,000, SMS alerts for selected transactions, consolidated statements, and priority service at CIMB Bank branches. Acknowledging its clients’ need for value, the plan also offers Prime Bonus Points for every ringgit spent on their CIMB Gold or Platinum credit cards, as well as other banking transactions with CIMB. England said that CIMB targets to attract 15,000 new customers by the end of this year and another 100,000 by 2010 with the launch of the plan.

AirAsia increases flights to meet year-end demand KUALA LUMPUR: AirAsia Bhd is increasing the frequency of flights from its Kuala Lumpur hub to Langkawi, Kota Kinabalu and Kuching to cater to the higher demand during the upcoming year-end holiday and festive season. The extra flights will open for sale on Oct 14 and service will commence from Nov 16 to Jan 6, 2010, said AirAsia in a statement

yesterday. AirAsia is also increasing flight frequencies permanently to Johor Baru and Penang from the Kuala Lumpur hub, effective Nov 19. To celebrate the added frequencies, AirAsia is offering an all-in-fare from Kuala Lumpur to Johor Baru, from as low as RM9 and to Penang from as low as RM29. – Bernama