Pos Malaysia to discuss Transmile options

Pos Malaysia says shareholders have raised the possibility of holding a controlling stake in the financially troubled air cargo firm 
 

Pos Malaysia Bhd (4634) has not ruled out the possibility of becoming a controlling shareholder in Transmile Group Bhd, but any firm decision will only be made after an extensive cost and benefit study, said its top official.

However, it has not committed to carrying out any such study at the moment.

Pos Malaysia chairman Tan Sri Dr Aseh Che Mat said that shareholders at its annual general meeting (AGM) yesterday had raised the possibility of its purchasing more shares in the financially troubled air cargo firm to hold a controlling stake.

It is currently the second largest shareholder in Transmile with a 15 per cent stake. According to Transmile's 2009 annual report, Trinity Coral Sdn Bhd, owned by the Kuok family, is the largest shareholder with a 17.16 per cent stake.
"It is one of the options, but if we want to take over, there must be a proper business plan. Otherwise we stand to lose due to Transmile's huge debt of almost RM500 million," Aseh told reporters after the AGM in Kuala Lumpur.

He added that if Pos Malaysia were to take over Transmile, the national postal company would have to utilise its profits over a five-year duration to wipe out Transmile's debts.

"We take note of the recommendation by the shareholders and, at the next board meeting, we will deliberate this issue carefully. Whatever decision we make, we do not want to drag down the profitable aspects of our overall business."

Pos Malaysia managing director and chief executive officer Datuk Syed Faisal Albar said it was adopting a defensive stance on its current stake in Transmile.

"We will wait and see what will happen to Transmile. Mind you, it has a national air certificate, landing rights in many places that many smaller aircraft don't have. So they are a national carrier and there is value to all of this," he said.

Syed Faisal said that an ongoing discussion at board level over the past several years had been whether or not the air logistics business fitted well with Pos Malaysia's long-term strategy.

He noted that about 70 per cent of Pos Malaysia's air logistics business in Sabah and Sarawak, amounting to RM110 million, was being handled by Transmile.

On the group's outlook, Syed Faisal said he expected revenue to increase between 15 per cent and 18 per cent respectively over the next two years, with the higher postal tariff in place from July.

On the unlocking of the land value on which its post offices and other operations are located, Syed Faisal said Pos Malaysia was conducting research on the best approach.

"The current charter requires us to only carry out postal activities and nothing else. We are doing a survey now on the best method (to proceed) - if there could be other ways for us to continue to pay lease to the government but be allowed some flexibility (in terms of the charter) or not," he said.
 




Read more: Pos Malaysia to discuss Transmile options http://www.btimes.com.my/articles/jposm12/Article/#ixzz0nlTak2cS

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