Good morning,
1) DRB Hicom: announced that it has bought up to 39.9m shares in Proton Holdings in the market yesterday, ahead of it's acquisition of Khazanah's 42.74% block in the company. The shares amounted to a 7.27% stake in Proton and were acquired between RM5.40 & RM5.47 per share. With this, assuming that the proposed acquisition is successfully completed, DRB will hold more than 50% of the voting shares in Proton. As such, the proposed MGO will not be conditional upon acceptance. It is not clear if DRB's plan is to delist Proton, or whether it still need access to the capital market. Meanwhile, with such a huge amount required for the Proton purchase, it is speculated that TS Syed Mokhtar may be looking at a few alternatives, which may include borrowings from foreign banks or selling off DRB's 70% stake in Bank Muamalat; Neutral.
2) Axiata: is said to be in talks to buy a stake in India's Tikona Digital Networks Ltd, according to sources. Axiata was holding discussions with Mumbai based Tikona owners Goldman Sachs Group, Oak Investment Partners & Everstong Capital Advisors, who collectively control 71% of Tikona. A deal might value Tikona at about US$1b. Investing in Tikona would allow Axiata, which owns a stake in Indian mobile phone carrier Idea Cellular Ltd, to tap into the rising demand for data services in India, the world's 2nd largest wireless market. Tikona holds licences to offer wireless broadband internet services in regions including Gujarat, Himachal Pradesh & Rajashtan, according to the Department of Telecommunication; neutral, to await more details.
3) TM: TM is in negotiations with 20 property developers to deliver it's high-speed broadband (HSBB) infrastructure services to new property projects, riding on a slew of real estate projects in the pipeline. TM representative said it was focusing on urban centres, such as the Klang Valley, Penang & Johor to take up it's HSBB offering for residential, commercial & office buildings. Last year, TM signed 11 agreements with property developers nationwide for the provision of HSBB services in new projects; +ve & expected.
4) Mkt: maintain range trade, accumulate on weakness CIMB, MAS, Perdana, Alam.
