Tuesday, 31 July 2012

(BUSINESS TIMES) Bidding process for RRI land to start by year-end

The prequalification process for bids for the Rubber Research Institutes of Malaysia (RRI) land in Sungai Buloh, Selangor, will start by the end of this year, says a source close to the Employees Provident Fund (EPF).

The source said EPF would call for the prequalification bids as soon as it gets the government's nod for the proposed development of the land.

Pre-qualification bids would be opened to developers who meet the requirements, he said.

"EPF will pen out the requirements and post them on its website soon. Among the criteria are strong financing, expertise, reputation and innovation," the source said.

EPF is the land owner and master developer of the project. It is buying 890ha of the available 1,215ha RRI agricultural land from the Federal Government for over RM2 billion.

The pension fund is expected to carve out the land in parcels of 20ha to 200ha each, depending on the use of it. The idea is to build low-end to luxury housing and commercial properties.

The balance of the RRI land is to house the Malaysian Rubber Board hub (217ha) and the My Rapid Transit (MRT) Sungai Buloh depot (72ha).

The master planning for the land development is being carried out by EPF's wholly-owned unit, Kwasa Land Sdn Bhd.

An official from the EPF said Malaysian Resources Corp Bhd (MRCB) was not involved in the master planning.

"MRCB's involvement in the project is on an arm's length basis. Like other developers, they will also have to bid for the land parcels," the official told Business Times.

EPF has a controlling stake in MRCB, the master developer of the KL Sentral project in Brickfields, Kuala Lumpur.

It is understood that several property players like Glomac Bhd, Mah Sing Group Bhd and Gadang Holdings Bhd have presented their ideas to the EPF.

The redevelopment of the RRI land forms part of the greater Kuala Lumpur Strategic Development initiative, a project under the 10th Malaysia Plan.

The southern portion of the RRI land, which includes parcels bordering the Tropicana Golf & Country Resort, falls under the jurisdiction of the Petaling Jaya City Council.

The northern portion, which houses the MRT depot, comes under the purview of the Shah Alam City Council.


(BUSINESS TIMES) YTL opens resort off Sabah

YTL Hotels has started operating the first of its two planned luxury resorts on islands off Borneo.

The diversified group started operating the Gaya Island Resort on July 1, YTL's first luxury property which it also owns in Sabah and Sarawak.

The resort, built at an estimated cost of RM75 million, offers a total of 120 villas and a two-bedroom suite.

Gaya Island Resort general manager Jeffrey Mong said the resort is targeting guests from the UK, Europe, Australia, Japan, Hong Kong, Singapore and Malaysia.

The resort is expecting to garner an average room rate of above US$350 (RM1,102) and an average occupancy of over 50 per cent in its first year of operation.

Mong in an e-mail interview with Business Times said the group expects the property's performance to be comparable to that of Pangkor Laut Resort, which is an island off the main island of Pangkor in Perak.

The resort's architecture respects Sabahan elements. It uses local materials which blends with the natural environment. Each of the 47 sq m villa features a spacious bedroom, a writing desk, a flat screen television with satellite channels, wi-fi access, a large open bathroom with an oversized bathtub and two vanity units, and an outdoor verandah with day beds.

The resort features one two-bedroom suite called Suria Suite, perched on sloping hillside. The ground floor of the 188 sq m unit has a lounge area, private dining room, a TV room, a powder room and a pantry which opens out onto a outdoor deck.

The first floor, meanwhile, has two separate bedrooms with walk-in wardrobes and vanity areas. It features an outdoor bath which leads onto the suite's private balcony.

There are 52 units of Kinabalu Villa with views of South China Sea and 40 units of Canopy Villa which are located on the hillside.

Another 24 units called Bayu Villas are set amongst the tropical mangrove on sloping hill offering and yet a mere walking distance from the resort's pristine sandy beach.

Gaya Villa, meanwhile, is also on the hill, offering a serene setting.

Other group hotels located in Malaysia include Cameron Highlands Resort, Tanjung Jara Resort and The Majestic Malacca. It will soon open the Majestic Hotel Kuala Lumpur.

Abroad, YTL group of hotels include MUSE Saint Tropez Ramatuelle, France, The Spa Village Resort Tembok, Bali, The Green Leaf Niseko Village, Japan and The Surin, Phuket.

According to Mong, all its properties are enjoying growth.

"At all our properties, we have increased the average daily rate (ADR) and occupancy numbers over the last several years as we have increased the awareness and level of experience offered at our hotels.

"We are always looking to improve our performance and are never satisfied with our results," he added.

Currently, its best performing hotel asset is JW Marriott, Kuala Lumpur.

Meanwhile, the planned YTL resort on the infamous "Survivor" island Pulau Tiga, is still under development. This resort, like Gaya Island Resort, is located off Kota Kinabalu, Sabah.

YTL's Pulau Tiga is expected to have 65 sea-facing luxury one and two-bedroom villas, all with their own private pools and dedicated spa treatment areas.

Other amenities here are to include a Feast Village, tennis courts, a gymnasium, a lap pool and a dive centre complete with recreational options.


(NST) New Bangsar high-rise raises concerns

ANXIOUS: Residents are worried that 40-storey service apartment project next to the former Unilever site will cause traffic congestion

RESIDENTS in Bangsar are concerned about a proposed 40-storey development in Jalan Tandok. They are worried that the high-rise development next to the former Unilever site may cause traffic congestion in the area.

The residents are also curious about plans for traffic management in the area.

They feel that the new development will increase the traffic flow here coming in from Jalan Bangsar and Mid Valley Megamall.

City Hall has put up a signboard in Jalan Tandok, stating that a developer is proposing to change the land use in the area from industrial to commercial.

The board also states that the developer is proposing to build a 40-storey service apartment with 495 units with a six-storey podium car park and a two-storey shop lot. It also stated that written objections for the proposed development had to be submitted by July 26.

Bangsar Baru Residents' Association president Datuk George Joseph said it is City Hall's duty to inform all residents' associations of any development that is to take place in the area.

He said this was crucial because the residents will need to know the impact of the development in their neighbourhood.

"We need to know whether a traffic impact assessment study has been done. Jalan Maarof is already congested with vehicles coming from Jalan Bangsar and Mid Valley Megamall. The residents need to know how the development will have an impact on the community," he said.

Lucky Garden Residents' Association president Datuk Nordeen Salleh said that even though the area doesn't come under the purview of any residents' associations, nevertheless it's the local authority's duty to inform the residents.

"Even though the development is in Jalan Tandok and doesn't affect us directly, but we still need to be informed of any projects," he said.

Bukit Bandaraya Residents' Association president Mumtaz Ali said that the residents are not against development, but they should be informed on any future developments in the area.

"We understand that the former Unilever land is valuable property. But there must be engagement with the residents' associations. We would also like to know about the ingress and egress to the proposed development," he said.

Spokesperson for Estet Perkasa Sdn Bhd confirmed that they had completed the acquisition of the 0.6ha land located in Jalan Tandok in the first half of this year.

"We are currently liaising with the relevant authorities to prepare the land for future development.

"At this juncture, it is still in the preliminary stage of planning and we have no immediate plans to commence development. In any case, we will fully comply with all requirements and regulations from the authorities."

The spokesperson also said that it is their intention to ensure that the development will add value to the surrounding communities.

(The Edge) Legoland Malaysia eyes 1m visitors in first year

KUALA LUMPUR: Legoland Malaysia, touted as the first international theme park in the country, is set to open its doors to the public on Sept 15. It is expecting more than one million visitors in its first year of operations.

“We have sold over 45,000 annual passes so far,” said Siegfried Boerst, general manager of Legoland, after a signing ceremony here yesterday. He added that the annual passes, priced at RM275 each, will be sold at a discounted price of RM245 until the launch in September. This translates into about RM11 million in sales.

Malayan Banking Bhd signed a five-year partnership agreement with Legoland to be the theme park’s official retail bank. “Under this agreement, Maybank will be the sole provider of retail banking services within Legoland as well as the upcoming Legoland Malaysia Water Theme Park and Legoland Hotel,” said Maybank president and CEO Datuk Seri Abdul Wahid Omar.

While the partnership is not primarily intended to bring in new customers for Maybank, Wahid said it would allow the bank to tap into Malaysia’s growing tourism market and build its brand presence internationally.

At least two ATMs will be installed within the park, along with more than 50 credit card terminals. The theme park is also expected to benefit from Maybank’s existing customer base, which will be offered discounts and promotions.

The 76-acre (30.7ha) theme park in Nusajaya, Iskandar Malaysia, will be the sixth Legoland in the world and the first in Asia. According to Boerst, the water theme park will open in the second half of 2013, while Legoland Hotel will be completed in early 2014. 

(The Edge) Creating an icon

Inspired by the Rockefeller Center

Tradewinds Corp Bhd, one of the largest hotel owners in the country, is ready to make its mark as a noted property developer in the country and the region. It aims to achieve this goal with an iconic project worth a whopping RM5.6 billion in gross development value in Jalan Sultan Ismail in the heart of Kuala Lumpur. Dubbed Tradewinds Centre, the mixed-use development designed by international architecture firm Kohn Pedersen Fox Associates (KPF) will be situated on the 6.9-acre site where Crowne Plaza Mutiara Kuala Lumpur and the adjacent Kompleks Antarabangsa now stand.

The project has five components — a 65-storey Grade A+ office skyscraper, a 54-storey serviced apartment tower next to it, a 14-storey medical centre, a 24-storey corporate office block and a retail podium-cum-central plaza at the centre of the development.

Tradewinds has 10 hotels in its portfolio, including Hotel Istana, Crowne Plaza Mutiara KL, Hilton Petaling Jaya, Hotel Istana, The Danna Langkawi, Hilton Kuching, Meritus Pelangi Beach Resort & Spa in Langkawi and Mutiara Taman Negara in Pahang. Nine of the 10 hotels are owned by Tradewinds. Its other investment properties include Kompleks Antarabangsa and Menara Tun Razak in Jalan Raja Laut. It also has joint venture property developments in Johor but none comes close to the likes of Tradewinds Centre. Listed on Bursa Malaysia since 1990, Tradewinds has a paid-up capital of RM1.1 billion and total assets worth more than RM3 billion.

According to Farez, Tradewinds will notify its key business partners, especially those of Crowne Plaza Mutiara, of the hotel’s closure after announcing the plans for Tradewinds Centre at its annual general meeting and extraordinary general meeting on June 29. The hotel, which has been in operation for almost 40 years, and the 30-year-old Kompleks Antarabangsa, are planned for closure by Jan 2, 2013, with demolition works expected to start in 2Q2013.

The Crowne Plaza Mutiara was once known as the Kuala Lumpur Hilton, one of the earliest five-star hotels in the country. In 2004, it was refurbished and rebranded as Mutiara Hotel. It subsequently became the Crowne Plaza Mutiara Kuala Lumpur. The 565-room hotel is now managed by InterContinental Hotels Group (IHG).

“We have our hotel staff, for example, who have served us very well and who have been with us for 20 to 30 years. We need to communicate with them and tell them what the future will be like. The closure process will require sacrifices from many parties as well as the understanding of our business partners. We want to give them adequate time and notice,” says Farez. “We are even planning a farewell-cum-New Year’s bash for the hotel. The hotel has a history and I am sure some people would like to say goodbye to it as well. It holds fond memories for many people, including our board of directors.”

Some people may remember the Tin Mine discotheque and also The Paddock Club, which were the places to be back in the 1970s and 1980s. Tradewinds’ redevelopment of its investment buildings began with Menara Tun Razak. The existing 34-storey building is being refurbished while a new 40-storey tower called Menara Tun Razak 2 is being added. This is expected to be completed by end-2015.

“We looked at our property portfolio and we looked at Menara Tun Razak and found that we could add another block to it, so we are doing that. Then we looked at two other properties — Kompleks Antarabangsa and The Crowne Plaza Mutiara Kuala Lumpur — and found that they looked tired. Even Kuala Lumpur City Hall (DBKL) asked us to do something about it,” says Poh.

Looking at the location and size of the plot, Tradewinds knew it was an opportunity to build something special. “I went looking for an architect and met quite a few top architects but there was an instant connection when I met the architects at KPF in New York. It was like meeting old friends … we had dinner, opened two bottles of wine and shook hands over dinner.

Tradewinds is not known in the US so we had to convince them to take on our project,” recalls Poh. The former group managing director of public-listed property developer Dijaya Corp Bhd joined Tradewinds upon his retirement and one of his tasks was to help raise the profile of the company’s property development business.

KPF is an expert in designing tall buildings and has won more than 100 international awards. It has designed the Shanghai World Financial Centre, the International Commerce Centre in Hong Kong, Roponggi Hills in Tokyo, the Bishopsgate Tower in London and the Marina Bay Financial Centre in Singapore. Tradewinds’ brief to KPF was simple — the development was to emulate the concept of the famous Rockefeller Center in New York.

The Rockefeller inspiration
The Rockefeller Center or Rockefeller Plaza, comprising 19 commercial buildings on a 22-acre tract, is situated in the centre of midtown Manhattan. The commercial buildings include Radio City Music Hall, Christie’s auction house, the Bank of America building and the Simon & Schuster building. It is a top tourist destination.

An artist's impression of Tradewinds Centre“Concept-wise, we like Rockefeller Center. It was created in the 1930s and is still relevant today. What is so exciting about it? You go there and see people from all over the world taking photos of the buildings and enjoying the environment. It has a garden and a sunken plaza with shops. During winter, they set up a small ice-skating rink and during Christmas, there’s this huge Christmas tree. It got me thinking that we lack that in Malaysia. Our buildings are all inward-looking and very exclusive in the sense that the people are kept out of it — it’s our building, our office, our land. When you walk up to a tall building, it can be quite intimidating.

“So we decided that we could create a group of buildings where people in Kuala Lumpur could feel a sense of belonging. Look at the Kuala Lumpur City Centre (KLCC). You see busloads of people taking pictures and the public gets to use the pool or walk around the garden. We do not have the kind of land that they have, but we want to engage the community in a similar way. “We have seven acres, out of which one acre will be allocated for a central grand plaza,” says Poh.

Central Grand Plaza
The concept of the Central Grand Plaza is akin to that of the sunken plaza in Rockefeller Center. It takes advantage of the project’s two frontages — Jalan Sultan Ismail and Jalan Tun Perak — so that the public have easy access. “You can enter from either road and immediately, you are within the project,” Poh says, adding that people can also walk through to get to KLCC.

He foresees people entering the plaza and taking pictures and enjoying the breeze and landscaping. It can also be used for New Year countdowns or other festive events. The project will be pedestrian-friendly as it will be connected to the existing elevated walkways in Jalan Perak.

An artist's impression of the Central Grand Plaza“I don’t think the height of our building — 65 storeys — will be the main feature of the development,” says Farez. “The focus, once it is completed, will be the experience at ground or street level. All the great buildings in the world have this street level presence where everyone is comfortable walking into the development.

“With better public transport, we have to anticipate more people visiting the development by foot or at street level. So, it is important for us to make them feel welcome. We feel that it will be something Malaysians will be really proud of once it is completed.” Farez expects the development to cost RM2.6 billion and take seven to eight years to complete.

Tradewinds plans to obtain MSC status and green certification for the development and is looking at Malaysia’s Green Building Index, the US’ Leadership in Energy and Environmental Design (LEED) and/or Singapore’s Building and Construction Authority’s Green Mark to get at least a gold rating.

The buildings in Tradewinds Centre will take up 46% of the land area and will be designed to look like elegant, multifaceted sculptures that look different, with the passage of the sun. There will be a “skin” on the exterior of the buildings that works as a sunscreen while giving them a unique webbed look.

The total net lettable area (NLA) of the offices will be 2.64 million sq ft while the retail podium will have an NLA of 150,000 sq ft. The office tower has an observation deck and will offer a column-free core-to-exterior span, which allows for a large floor plate of more than 20,000 sq ft. The serviced apartments will be the only component for sale, with built-ups possibly ranging from 800 to 2,000 sq ft.

Poh reveals that two foreign companies have approached Tradewinds to be partners in the development but the developer has decided to build it on its own. Says Farez: “Our plot is sizeable, considering its location within the Kuala Lumpur city centre. We want the whole project to be a destination. This development is more to us than just a business proposition.

It is what we stand for as a builder and property investor going forward. With the exception of the serviced apartments, we will retain the rest of the development for investment. It is therefore a long-term play on a key area in Kuala Lumpur over which we would like to retain some ownership.”
“It’s the element of presence and branding for the future of the company, which this development stands for,” Poh chips in.

Farez continues: “There is a lot of talk of office oversupply, but we feel that the components we are putting together are not for today, not for the next year or for the next four years … they are for longer than that. You can only really achieve that if you have the determination to hold onto the asset for the long term. In fact, Grade A+ office buildings like these are in quite short supply here.”

Tradewinds Centre could be built in phases, depending on the market climate. “For now, we plan to build everything at the same time. A lot of people try to time the market. It is not possible for a project that lasts seven or eight years. We might as well go ahead and do what we want to do. All the major buildings around the world are like that,” says Poh.

Tradewinds has a total landbank of over 4,000 acres in Kuala Lumpur, Johor Baru and Penang. “We are constantly reviewing our properties and we think that maybe once we start Tradewinds Centre, some landowners may approach us to develop their properties,” Poh says, adding that the developer also has some plans for Langkawi. On whether Hotel Istana will be redeveloped next, Farez says there are no current plans for the hotel. Tradewinds has also offered to participate in the redevelopment of UDA Holdings’ Bukit Bintang Plaza in Jalan Bukit Bintang.

Source: The Edge

(The Edge) PM launches RM26b financial district

KUALA LUMPUR (July 31): Prime Minister Datuk Seri Najib Razak yesterday launched the city’s new financial district, called the Tun Razak Exchange (TRX), which has an indicative gross development value of RM26 billion.

In appreciation of the contribution by Malaysia’s second Prime Minister Tun Abdul Razak who was his father, Najib said TRX, renamed from the Kuala Lumpur International Financial District (KLIFD), is expected to attract over 250 global companies and is slated to become a global centre for international finance, trade and services.

“What began as an idea for KLIFD has evolved into something larger and more inclusive,” Najib said at the launch of TRX. With 1Malaysia Development Bhd (1MDB) as the master developer, the TRX will be built on a 60-acre (24ha) land off Jalan Tun Razak and will take 15 years to complete.

Najib said 1MDB had managed to lock in an international partner for the entire first phase of TRX and secured over RM3.5 billion in foreign direct investment (FDI). “It is significant to note that this international partner is the first mover in establishing a strong ecosystem to support the infrastructure for the exchange,” he said.

However, Najib said details and the identity of the partner will only be revealed in September. To attract foreign investment, Najib said some of the incentives to be introduced are an income tax exemption of 100% for 10 years, stamp duty exemption on loan and service agreements, industrial building allowance and accelerated capital allowance for companies.

Property developers that qualify for the TRX project will also enjoy a 70% income tax exemption for five years. To spearhead the development of TRX, Najib had formed a special task force to review and implement policies to attract investors.

The task force is chaired by Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop and includes senior members from the Ministry of Finance, Bank Negara Malaysia and the Securities Commission Malaysia.

“We expect more than 250 of the world’s leading companies to locate here, creating 500,000 jobs directly and indirectly. About 40,000 would be knowledge workers specified to finance services,” said Najib.

The prime minister added that TRX is expected to help further grow the Islamic financial sector in Malaysia.

“I am committed to doing everything I can to make it easier for investors to participate in Malaysia’s Islamic finance markets,” he said. Najib is the chairman of 1MDB.

With the first phase expected to be completed in 2016, the TRX will have offices, residences, retail space and public institutions. A 14-acre park is also included at the heart of TRX.

The TRX was first announced by Najib in 2010. It was one of the early Entry Point Projects under Malaysia’s Economic Transformation Programme. Since then, 1MDB has relocated most of the occupants and businesses to the area.

It called for a tender process for major foundation works last December but had not announced the winners. However, the ground-breaking ceremony was conducted at the launch yesterday.

(The Edge) Puteri Harbour eyes 500,000 visitors in first year of operations

KUALA LUMPUR (July 31): Themed Attractions and Resorts Sdn Bhd (TAR), a wholly-owned unit of Khazanah Nasional Bhd, expects to attract 500,000 visitors to its Puteri Harbour Family Theme Park in the first year of its operations.

Managing director and chief executive officer Tunku Datuk Ahmad Burhanuddin said 55% of the visitors would be locals and the rest foreigners, mainly Singaporeans.

"The development of the theme park is a testament to TAR's commitment to enhancing and elevating Malaysia's position as a key tourist attraction within the region," he told a media briefing on the theme park here on Tuesday.

He said TAR was currently working on destination marketing effort to promote not only its theme park but also to get people into Nusajaya and Iskandar Malaysia as well.

The four-level building of the theme park, scheduled to be opened in November this year, will provide a series of unique experiences and excitement through popular global children's characters from LAT, Sanrio Hello Kitty Town and The Little Big Club.

The tickets, priced at RM65 for non-MyKad holder and RM50 for MyKad holders, are available tomorrow via its website

Meanwhile, on whether TAR was in negotiation to set up another theme park, he said: "We are always looking (for opportunity) and we will announce it at an appropriate time. We want to concentrate on this region for the moment."

TAR also manages LEGOLAND Malaysia, KidZania Kuala Lumpur, KidZania Singapore, Ocean Quest at Desaru Quest, Water World at Desaru Quest and Malaysia Truly Asia Attraction. 

(The Star) TRX set to bring in more FDI

KUALA LUMPUR: The Kuala Lumpur International Financial District now has a new name The Tun Razak Exchange (TRX).
Under the newly-launched project, Prime Minister Datuk Seri Najib Tun Razak said RM3.5bil in foreign direct investment was expected to be generated in the first phase of the development.
The 28.3ha development off Jalan Tun Razak is also expected to bring in RM26bil in gross development revenue.
“What began as an idea for KLIFD has evolved into something larger and more inclusive,” said Najib when launching the project at the site here yesterday.
He added that the Government had locked in a partner for the first phase, but its identity and details would only be announced in September.
The Government's strategic development agency 1Malaysia Development Berhad, which is in charge of the project, said the target tenants included top multinationals from various industries, financial institutions, support service firms and commercial and hospitality tenants.
With more than 100 top global companies expected to be based at TRX, the project could create a total of 500,000 jobs.
The exchange is one of the Entry Point Projects under the Economic Transformation Programme and is poised to be a catalyst for Kuala Lumpur to be a leading global centre for international finance, trade and services.
Others who were present included 1MDB chief executive officer Datuk Shahrol Halmi, Federal Territories and Urban Wellbeing Minister Datuk Raja Nong Chik Zainal Abidin, Minister in the Prime Minister's Department Tan Sri Nor Mohamed YakcopDeputy Finance Minister Datuk Donald Lim and 1MDB chairman Tan Sri Lodin Wok Kamaruddin,
Also present were adviser to Japan's Cabinet Managing Executive Officer of Japan Bank for International Cooperation Tadashi Maeda and his special adviser Omar Qandeel.
The planning and development of the exchange will be overseen by a special task force led by Nor Mohamed.
Najib said the Government would also start reviewing the bureaucracy to do business in here, especially in the field of Islamic finance.
“The Government will go out of its way to ensure that the exchange is a success and, as a first step, I announce to you today that we will begin a comprehensive review of business regulations. Anything that contributes to future progress stays, anything that is outdated goes.
“I am committed to doing everything I can to make it easier for investors to participate in Malaysia's Islamic finance markets,” he said.

(The Star) Franchise business growing, has been posting 20% growth

PETALING JAYA: Deputy Finance Minister Datuk Donald Lim Siang Chai has commended the homegrown franchise business' contribution to the growth of the industry which is in line with the country's goal to become a high-income nation.
“To date, 586 franchises have registered in Malaysia in which 9% are homegrown brands,” Lim said during the launch of ADAMAS Franchise Concept Outlet.
“Being a young sector, many of our homegrown franchise brands have emerged strongly from the domestic and foreign markets.
“This is a significant growth with a 20% increase per annum in the last two years under the National Franchise Development Master Plan 2012-2016,” he said.
The objective of the blueprint is to create a vibrant market by positioning Malaysia as the franchise hub for the South-East Asia and Middle East market. The Government targets a 9.4% contribution from this industry to the country's gross domestic product by 2020.
He lauded ADAMAS Weddings Sdn Bhd's effort in recruiting franchisees from China and Cambodia, which set an example for what other local franchisers could do to boost the development of the franchise industry, adding that entrepreneurship provided endless opportunities and possibilities.
On the local front, the wedding planning consultancy and training company, which obtained its franchise license from the Ministry of Domestic Trade, Co-operative and Consumerism Malaysia last September, is also planning to set up stores in Penang and Klang.
“We expect to launch another outlet in Johor by end of this year,” ADAMAS founder Dr Khoo Kien Ling said, adding that she trained other wedding planners but was not afraid of them becoming competitors because she had seen the demand for the profession. She expects to see 60 trainees graduate from her course this year. Under the franchise scheme, the company will assist aspiring wedding planners to set up their business. A franchise outlet costs RM250,000 while a micro franchise without a physical outlet costs RM23,000.
The scheme enables business owners to leverage on ADAMAS' creative team so that they can skip the creative conceptualisation process which is important in wedding planning. The company also adopts a “distributor” business approach to supply materials to the franchisees so that they can keep their costs low.
While it is a growing business in the region, Khoo admitted that the industry was not totally shielded by the economic environment.
On another note while responding to a reporter on whether lower oil prices would affect the country's economy, Lim said, “The dependency on the oil for the nation's revenue has gone down from the 90s where 50% is on oil. Now, it's only one-third of our revenue on oil only.
“So, the figure (percentage of oil revenue to country's total revenue) is coming down so even though oil price has decreased, it would not really affect us so much,” he added.

(The Star) Joint study on M'sia-S'pore Rapid Transit System

JOHOR BARU: Malaysia and Singapore will make the decision on the Malaysia-Singapore Rapid Transit System (RTS) link project next year.
Iskandar Regional Development Authority (Irda) chief executive officer Datuk Ismail Ibrahim said authorities in both countries were currently undertaking a phase one joint-engineering study.
He said the study, among others, looked into the various alignments, customs, immigration and quarantine-related matters and multimodal terminal locations and other critical perimeters.
“Once it is completed, both governments will make a decision on the preferred alignments,'' Ismail told StarBiz yesterday.
He said there would probably be two options for the RTS project linking Johor Baru and Singapore for the trains to run above ground (grate) or via undersea tunnel.
Ismail said if the latter was chosen for the project, there would also be a choice on whether there it would be a sunken tunnel or a bore tunnel.
He said the undersea tunnel was more favourable as it would have minimal disruptions to the traffic movements during construction period as the project would be located nearby to the CIQ complexes of Malaysia and Singapore.
“The final outcome on what kind of link will be built will all depend on the recommendations of the study for the consideration of the two governments involved as well as costing,'' added Ismail.
In May this year, Malaysia and Singapore had announced that both countries would undertake a project to improve connectivity by opening a RTS from Singapore to Johor Baru by 2018.
The joint Singapore-Malaysia statement said that the terminating stations of the link would be in the city of JB Sentral here and in the vicinity of Republic Polytechnic in Singapore.
It added that the RTS link was targeted to be up and operating by 2018 and have a co-located (CIQ) facility in Singapore and co-located CIQ facility here so that commuters need to clear immigration only once for each way of travel.
Separately, Ismail said the implementation of the intercity rail project in Iskandar Malaysia was still being evaluated to ensure the feasibility of the project.
He said so far, two parties had submitted their proposals.
However, more details were needed before a firm decision could be made.
“Nevertheless, Irda noted the high implementation cost for the project while coverage is somewhat limited compared with other public transport system,'' said Ismail.

(The Star) GO imminent for Bandar Raya shares at RM2.90 each

PETALING JAYA: A general offer for property developer Bandar Raya Developments Bhd (BRDB) at RM2.90 per voting share and the corresponding indicative price of RM1.80 per warrant could be in the offing.

The company told Bursa Malaysia it was informed by its major shareholder, Ambang Sehati Sdn Bhd, that the latter was in the midst of finalising the financing, including procuring the necessary approvals for the funding for a potential takeover offer of voting shares and warrants in BRDB that it did not already own.
Ambang Sehati, which controls 18.5% in BRDB, is the same party that had previously attempted to take over BRDB via the assets and liabilities route. Ambang Sehati is the private investment vehicle of Datuk Mohamed Moiz Jabir Mohamed Ali Moiz, the chairman of BRDB.
In September last year, Ambang Sehati proposed to buy BRDB’s properties, namely Bangsar Shopping Centre, Menara BRDB, CapSquare Retail Centre and Permas Jusco Mall for RM914mil. However, the proposal was deemed controversial and drew criticisms from various parties, who expressed concern over the lack of transparency in the deal and the fairness of the offer price, coupled with the fact that it was a related-party transaction.
The outcry resulted in BRDB subsequently calling off the sale. It instead decided to call for an open tender to take into consideration the interest from credible parties to acquire its assets, and also Ambang Sehati’s intention to increase its stake in the company.
In March this year, BRDB said it was one step closer to selling off its four prime assets via an open tender, with the appointment of its legal and financial advisers to assist in the deal. It told Bursa Malaysia then that it was working with Lee Hishammuddin Allen & Gledhill and CIMB Investment Bank Bhd in the proposed disposal.
But not much progress was made after that.
BRDB’s share price had been rallying since last week. Yesterday, it rose two sen to close at RM2.53. That was up from RM2.35 a week ago.
BRDB said the current offer price from Ambang Sehati at RM2.90 per share was based on the estimated diluted net tangible assets per share in BRDB.
Some said the offer price of RM2.90 per share, which represented a premium of 14.6% from yesterday’s closing price of BRDB, was attractive compared to the earlier assets and liability offer whereby the indications were that shareholders were only going to be paid a special dividend of 80 sen per share.
It should be noted that in the previous deal, BRDB would still be left with other assets although many had argued that the assets Ambang Sehati was looking to buy then were the prized assets of the company.
Should the curent deal go through, shareholders will have the option of totally exiting BRDB at RM2.90 per share.

Monday, 30 July 2012

(BUSINESS TIMES) MRCB in line for RM1b MRT job

Malaysia Resources Corp Bhd (MRCB) is expected to win a contract worth about RM1 billion this week for the Sungai Buloh-Kajang (SBK) MY Rapid Transit (MRT) line.

If awarded, this will be the first railway-related job for MRCB this year.

MRCB, which is 42 per cent owned by the Employees Provident Fund, also won a RM1.33 billion contract for the Ampang light rail transit (LRT) extension project in August 2011.

The MRT contract is expected to boost MRCB's existing order book to more than RM2.5 billion.

Business Times learnt that the latest contract is to build viaduct guideways and other associated works between the Taman Mesra and Kajang stations.
Project owner Mass Rapid Transit Corp Sdn Bhd (MRT Corp) was not immediately available for comments.

Kenanga Investment Bank Bhd recently pegged a target price of RM2.71 per share for MRCB based on sum-of-parts valuation.
Other analysts placed a target price of as high as RM3.10 on MRCB. The stock closed at RM1.73 last Friday.

There are eight viaduct work packages available for the SBK line and seven have been awarded by MRT Corp.

The other winners are Gadang Holdings Bhd, Mudajaya Group Bhd, IJM Corp Bhd, Ahmad Zaki Resources Bhd, Sunway Construction Sdn Bhd, MTD Construction Sdn Bhd and Syarikat Muhibbah Perniagaan & Pembinaan Sdn Bhd.

Sources close to MRT Corp said it was also expected to award several contracts to build stations and a depot over the next few weeks.

This includes a contract worth RM1.6 billion to supply trains for the SBK line.

MRT Corp has received bids from Changchun Railways Vehicle Co Ltd, Siemens SMH Rail Consortium and CSR Zhuzhou Electric Locomotive Co Ltd to supply the trains.

"The awarding of contracts for the SBK line is progressing smoothly. Those interested companies will not have to wait too long to know the status of their bid. MRT Corp is evaluating all bids cautiously.The award of contracts will be transparent," the source said.

So far, MRT Corp has awarded 33 contracts valued at RM15.5 billion for the SBK line.

There are 21 contracts in the process of evaluation. The remaining 31 contracts will be awarded by the end of this year.

The final value of the SBK Line stretching 51km will be determined by the end of this year after all 85 contracts have been awarded.


(The Star) Survey on market facelift on public display

GEORGE TOWN: An exhibition of the urban markets survey commissioned by ThinkCity Sdn Bhd on behalf of the Penang Municipal Council (MPPP) will be presented to the public for a week beginning today.
It will be held at the first floor foodcourt of the Chowrasta Market in Penang Road here.
ThinkCity had appointed Badan Warisan Heritage Services to conduct the survey.
The findings and recommendations contained in the survey report have been adopted as a guidance for the major facelift of the Chowrasta Market, taking into account decisions that have been formulated by the local authority in relation to issues of legality of vendors, spatial needs of vendors and users, right of way, accessibility, car parks, health and safety.
Among the key features of the new upgraded market will be a new multi-storey car park with about 140 bays, new heavy-duty escalators connecting the ground floor to the first floor, two passenger lifts and one service lift, better market layout on the ground floor and new toilets on the ground floor.
“It will also be the first market to achieve the Green Building Index (GBI) certification and also having an organic waste composting on-site.
“The inside of the market will be brighter, airy and hopefully dry,” said the MPPP director of building Yew Tung Seang at a press conference yesterday.
State Local Government and Traffic Management Committee chairman Chow Kon Yeow said the MPPP had allocated more than RM12m for the upgrading works.
He said that work would be done phase by phase to minimise disruption of the business there.
The full report can also be accessed on the ThinkCity website,
A second focus groups workshop will be held on Aug 6 at the market’s first floor market at 2pm.

(BUSINESS TIMES) There’s room for growth

Singapore-listed Hotel Royal Ltd hopes to double the number of hotels it owns and operates to 10 within the next five years.

Hotel Royal, which has hotels in Singapore, Malaysia and Thailand, plans to increase its network in Malaysia and Thailand, and venture into Indonesia.

“We plan to acquire one hotel each year over the next five years,” chief executive officer Lee Chou Hock said.

“We see potential for expansion in Malaysia and we are looking at Mala- cca and Kota Kinabalu,” he said.

Lee, in a recent interview with Business Times here, said the group is also eyeing Phuket, Thailand and Bali, Indonesia.
The group’s preference is to buy hotel assets with room inventory of between 280 rooms and 300 rooms.

“We’d rather buy existing properties as we can see immediate revenue. We also hope to see capital appreciation,” he said.
Hotel Royal now operates a 350-room hotel in Newton Road Singapore and the 235-room Hotel Royal@Queens.

Its entry into Malaysia three years ago was via the acquisition of a 276-room hotel (and retail) for RM56 million and the previous 225-room Coronade Hotel in Kuala Lumpur for RM93 million.

Its most recent acquisition, late last year, was within the Chinatown area in Bangkok.

The group also owns and manages an office complex in Wellington, New Zealand.

In the year ended December 31 2011, the group registered a revenue of S$48.81 million (RM123.7 million) and a net profit of S$5.89 million (RM14.9 million).

Singapore Hotels contributed S$31.13 million (RM78.9 million), Malaysia S$10.87 million (RM27.6 million) and Thailand S$462,000 (RM1.2 million).

The group is planning to upgrade the 315-room hotel in Bangkok to a four-star property. The makeover will cost between S$15 million and S$20 million (RM38 million and RM51 million).

Meanwhile, Hotel Royal Kuala Lumpur is undergoing a RM27 million renovation which is expected to be completed earliest by year-end.

The 15-year-old hotel will have 287 rooms, from 225 rooms now. It is also improving its mechanical and electrical systems and the frontage.

“Our tagline is ‘Every room a home’ as we take care of tiny details for our guests to feel at home,” Lee said.


(NST) The plot ratio thickens in the tale of Penang

A recent technical study has ranked Penang below Singapore, Hong Kong and Kuala Lumpur in urbanisation development.

Perhaps that might prompt the local council to re-look and revise its planning guidelines to maximise land use in the state.

The current population density to plot ratio of one to five in urban Penang clearly lags behind Singapore (one to 12), Hong Kong (one to 15) and even Kuala Lumpur (one to 10).

Penang Island Municipal Council (MPPP) councillor Ng Chek Siang has said that the island faced acute land shortage, with land available for development limited to a mere 17 per cent the total land area, according to the planning department.

He concurred that a high density and compact city form would be the most ideal development pattern for the island state in the near future.

For that to happen, Ng said the existing planning guidelines needed to change to accommodate the growing population and economic and social demands.

Penang's current population density to plot ratio in the urban area is too low and many would tend to agree with Ng's proposal for Penang to close the gap with other cities.

It is every Penangite's hope to see more efficient land use, the retention of green space and an effective and sustainable public transport system.

In a way, credit should go to the MPPP for recognising the need for high-density residential schemes in urban areas to make more efficient use of land and make the provision of public services and facilities more cost-effective.

"High density maximises public transport usage while minimising the distance travelled between sites on day-to-day activities. The approach also reduces energy and infrastructure costs," Ng was quoted as saying at a full board council meeting recently,

The island's population, Ng pointed out, was estimated to increase by 30 per cent come 2030.

It is heartening to see the MPPP trying to house the population in the cities and stop converting dwindling hill and agriculture land into residential land.

High-density cities have a better chance at achieving more sustainable transport systems, which is in line with the Penang Traffic Master Plan to have a 40 per cent public ridership.

Already, Singapore's public ridership stands at about 50 per cent. It is high time Penang, which public ridership comes up to a mere 10 per cent, follows the path that the high-density and compact city has taken.

A compact city comes with a population density great enough to sustain an integrated, effective public transport system.

There is less need or distance to travel within a compact city, which makes walking or cycling viable options the the citizenry.

Can we achieve it all? The answer is a resounding "yes" if the state authorities have the political will move Penang into a new direction in urban planning.

More importantly, the developers must also share the vision and act accordingly by building more compact premises.

That is why it is imperative for the MPPP to come out with a urbanisation master plan that will breath new life into the city.

At the opening ceremony of the London Olympics, the cauldron was lit by seven young athletes, in line with its tagline to "Inspire a Generation" and a symbol of the need to constantly think outside the box to scale new heights.

The colourful, cheeky and entertaining performances from a star-studded cast were awe-inspiring, to say the least, reminding us that there are no mountains too high to climb.

Perhaps we as Malaysians, more specifically Penangites, can also feel the spirit of the Olympics, which kicked off with a bang.

"Let the Games begin" at the event, which athletes and feats will be holding us enthralled over the next fortnight.

Let us hope the same spirit will prevail in the urbanisation of Penang.


(The Star) Compact city model

A high-density and compact city form will be an ideal development pattern for Penang island as it is facing a shortage of land.
Penang Municipal Councillor Ng Chek Siang said Penang island was facing a shortage of land.
He said that forest reserves and hill land covered an estimated 52% of the island.
“Our current density/plot ratio is too low (1:5) compared to Singapore (1:12), Hong Kong (1:15) and Kuala Lumpur (1:10),” he said.
He said there were several advantages of having a high density and compact city form for the state.
“A compact city has population densities that are great enough to operate and maintain a sustainable public transport system,” he said during the Penang Municipal Council meeting held at the City Hall recently.
He said a compact city form could also create more efficient land use and would be more cost-effective in providing public services and facilities.
“In terms of transportation, Hong Kong has one of the lowest energy consumption per capita in the world.
“High density maximises the effectiveness of public transport while minimising the distance between the sites of day-to-day activities,” he said.
He added that it could also reduce energy and infrastructure costs.
“I also strongly recommend that plot ratio be used as a measure to determine the gross floor area in residential units per acre.
“It means that the developer can build smaller units and increase the affordable housing supply on the island to suit our future needs,” he said.

(NST) Village gets flyover costing RM500,000

ALOR STAR: SOME 400 residents of Kampung Pegawai, here, were thrilled when the Federal Government announced an allocation of RM500,000 for the construction of a flyover across a railway track at the village

The announcement was made by Kedah MCA chairman Datuk Chong Itt Chew when he visited the village.

When the flyover was ready, Chong said, villagers would no longer have to travel 2km to get to a surau which was located just 200m from the village.

"Previously, villagers only had to walk across a railway track to get to the surau. The crossing was closed to make way for the Ipoh-Padang Besar electrified double-track project five years ago. This is a burden for the villagers," he said.

Chong said the Federal Government decided to approve the allocation because it was concerned about the welfare of the villagers.

Kampung Pegawai village development and security committee chairman Ahmad Tajjudin Bahari thanked the government for helping villagers.

"We appreciate the hard work put in by the Barisan Nasional and MCA leaders to help resolve our problems."


(The Star) Sinfully delicious souvenirs

They look too good to eat. That was my first reaction when I visited Chocolata Designs at Subang Parade, a company that customises your chocolates with personalised messages, company logos or even photographs.
Chocolata Design distributes chocolates made by Chocolate Graphics (M) Sdn. Bhd, the Malaysian counterpart of Chocolate Graphics International.
An Australia inventor is said to have originally conceived the Chocolate Graphics process in 1988, but his method was crude and extremely slow. Not much was done with the process until 1999 when John Taylor purchased the rights to it.
Based in the United States, Chocolate Graphics International today markets the unique products and manufacturing process worldwide using the licensing/franchising model.
More than a mouthful: Gomez showing a giant bar of chocolate with a picture of the Petronas Twin Towers.
In 2005, Chocolate Graphics (M) Sdn Bhd obtained the master licence from Chocolate Graphics International to become the sole developer of these types of chocolates in Malaysia.
“They are excellent as gifts and premiums, or for general corporate marketing communications, like brand-building.
“You could use them for product launches, functions, seminars, conventions and trade shows,” said Chocolata Design’s founder Philip Gomez, who joined the business in the fourth quarter of 2005.
“It was tough in the beginning as many did not understand our concept. They did not believe that we could customise the chocolate.
“We took part in wedding fairs and exhibitions to educate Malaysians about the brand,” said Chocolate Graphics Malaysia’s founding member Chin Siew Hua, adding that an initial investment of RM1mil was needed to kickstart operations.
Chin said until 2010, they were the only distributors in South-East Asia until another company obtained the master licence in Vietnam. Currently Chocolate Graphics Malaysia ships its finished products to Singapore, the Philippines, India, Brunei and Hong Kong.
Gomez explained that anything that can be printed on paper can be turned into a design on chocolate, however, it should be a two-toned (black and white) design as they use milk, dark and white chocolates to create the designs.
“We have done weddings, corporate functions, socialite events to name a few. Our clients include Singapore Airlines, Star Cruises, and Baskin Robbins, among others.
“We also provided customised chocolate designs for Datuk Siti Nurhaliza’s wedding,” said Chin, who explained that all their chocolates are handmade.
Too good to eat: Unique chocolates with customised designs make great gifts and can be used for corporate functions.
Gomez said, lately, one of the more popular designs is to place quick response codes (QR Codes) on chocolates for corporate functions. It creates curiosity and everyone tries to scan the code to check if it works. Business usually peaks during Mother’s Day, Valentine’s Day and year end. The price of customised chocolate designs range from RM2.50 to RM60 depending on size.
From a financial standpoit the business has been profitable. Gomez said sales figures have exceeded RM200,000 despite 90% of Malaysians being unaware of their capabilities. For details, email

(The Star) Reps highlight pleas to preserve heritage buildings

THE call to preserve the built and cultural heritage while developing the capital was again made with representatives from several groups staging a protest in front of Stadium Merdeka on Saturday.
Pertahankan Warisan Kita chairman Ishak Surin, Kuala Lumpur and Selangor Chinese Assembly Hall CEO Tang Ah Chai and Petaling Street Community Art Project director Yeoh Lian Heng were present at the protest.
Representatives from Kampung Railway in Sentul and Kampung Kerinchi in Pantai Dalam were also there to highlight their plight.
“Many families have lost or are losing their homes where they had lived for decades because of inconsiderate development by the Kuala Lumpur City Hall (DBKL),” said Ishak, citing the situation faced by residents of Kuala Lumpur who were asked to make way for development.
“We want a local government that listens to the people, not one that constantly disappoints its people,” he added.
Ishak, who is from Kampung Banda Dalam, said the existence of his village and seven others was threatened as they had been earmarked for development in the draft Kuala Lumpur Local Plan 2020. The villages were later saved following the residents’ strong objection.
Mohd Idros Tokiran, 48, from Kampung Kerinchi said life at the PPR Muhibbah in Puchong and PPR Seri Chempaka in Pantai Dalam, where the families were moved to was difficult as most of them did not own a car.
“The government must also look at the humanitarian aspects when they develop the city,” he emphasised.
S. Subra, 72, from Kampung Railway, said they were shocked when slapped with a court order which gave them 14 days to leave the place where their families had lived for over a century.
“This is really saddening for our grandparents who settled here,” he said.
Another resident, known only as Arjanan, said the families had paid quit rent, assessment and utilities through the decades but were now labelled “trespassers”.

(The Star) KL-S'pore high-speed rail project expected to commence soon

By Affin Investment Bank
Overweight (Maintain)
High-Speed Rail (HSR) project linking Kuala Lumpur to Singapore is expected to commence soon
The chief development officer of SPAD added that the HSR project was targeted to start next year with tenders to be called by end-2013.
News that the HSR project may be feasible and tenders to be called by end-2013 are positive for the construction sector.
In addition to the main project manager(s) and/or concession holder(s), other construction companies are expected to benefit from sub-contract works.
Construction and building materials suppliers would also gain from stronger orders and firm prices. Depending on the final alignment and location of stations, selected landowners, especially plantation companies, would also see appreciation in land value.
A potential contract win is a key re-rating catalyst for both group of companies.
The civil engineering work itself (excluding rolling stocks) may be worth an estimated RM8bil-RM10bil, a substantial boost to orderbook for any construction player in Malaysia.
There will be more work when tenders for the My Rapid Transit 2 (MRT2) and (MRT3) are called and awarded, as well as for other Economic Transformation projects, such as the Kuala Lumpur International Financial District and Langat 2.
News flow to continue to be positive, we maintain overweight.

(The Star) Khazanah unit restaurants where 'you can eat side-by-side with animated Lat characters'

PETALING JAYA: Themed Attractions and Resorts Sdn Bhd (TAR), a wholly owned subsidiary of Khazanah Nasional Bhd, plans to open theme restaurants based on cartoonist Lat's beloved characters in Johor and Kuala Lumpur.
Chief executive officer Tunku Datuk Ahmad Burhanuddin said the restaurants, to be called Lat's Place, would provide an immersive and interactive experience.
“It's the first of its kind in technology. You can eat side-by-side with animated characters,” he told StarBiz during a tour of TAR's first theme park, KidZania, in Petaling Jaya last week.
The first of the restaurants, which will serve regional cuisine, will open its doors by year-end at the Puteri Harbour Theme Park in Nusajaya, Johor. Theme park will also feature the first Hello Kitty Town in South Asia and the world's first Little Big Club, whose characters include Bob the Builder, Barney and Thomas the Tank Engine.
Colourful: Themed Attractions and Resorts Sdn Bhd chief executive officer Tunku Datuk Ahmad Burhanuddin in front of one of the stores at KidZania, Mutiara Damansara. The company plans to open theme restaurants based on cartoonist Lat’s beloved characters in Johor and Kuala Lumpur.
TAR would open Lat's Place in Kuala Lumpur within the next few years as part of the Malaysia Truly Asia attraction, he said.
The company will also look at the viability of establishing Lat's Place overseas.” “We can bring it to Oxford Street (London), Fifth Avenue (New York) or mid-town Tokyo. They can also enjoy Malaysian food,” he said.
Tunku Ahmad said TAR was not looking at creating its own branded theme parks for export at the moment. “If at all we export something, it will be our expertise in managing the parks,” he said.
KidZania, TAR's first theme park, has received over 100,000 visitors since its opening in February this year. It targets 400,000 to 500,000 visitors annually.
The RM80mil indoor edutainment theme park, which originated in Mexico, allows children to understand the world of grown-ups by role-playing over 90 different activities, including pilot, surgeon, judge, policeman, sushi chef, fashion model and reporter.
Kids are also taught about financial discipline. They get 50 KidZos (KidZania's currency) per visit, and they earn kidZos by doing certain activities (such as being a mechanic) and spend it though other activities (such as driving a car or buying toys at KidZania's department store). They can even deposit the kidZos at KidZania's CIMB Bank to earn interest and withdraw it during the next visit!
The kid-centric “city” of KidZania has 37 industry partners from AirAsia to Honda which sponsor its various establishments for three to five years, with each contract valued between RM500,000 and RM1mil.

(The Edge) Vale Malaysia open to collaboration

KUALA LUMPUR: Vale Malaysia Minerals Sdn Bhd, the local unit of Brazilian mining giant Vale SA, is open to discussions with Integrax Bhd and other parties on collaboration for its iron ore distribution centre and port in Lumut, Perak, said director Marcelo Figueiredo.

“Integrax has approached us and we are open. Vale is open for what is good for the company and the community. We have received some approaches and opportunities and we are studying everything in an open way,” said Figueiredo in an interview with The Edge Financial Daily.

“Vale is interested in doing business in a sustainable way. As such, we want to ensure that we are hearing everybody and open for any opportunities,” he emphasised.

In 2009, Vale and port operator Integrax signed an agreement for Integrax to provide transshipment services in Lumut for 10 years. However, a disagreement at Integrax led to a boardroom tussle and the agreement lapsed. The Perak government has since given the green light to Vale to build its own jetty.

More recently, the Perak government has set up a committee to look at how the Vale project can benefit the state. The committee is made up of state secretary Datuk Abdul Puhat Mat Nayan; Datuk Hamidah Osman, the state executive councillor for industry; Datuk Samsudin Hashim, CEO of Perak Corp Bhd; Tan Sri Mohammad Tajol Rosli Mohamed Ghazali, former Perak menteri besar; and Datuk Muhd Hafni Ibrahim, CEO of InvestPerak.

Figueiredo said the state committee has not yet approached Vale. However, he stressed that Vale has good relations with the state government and federal authorities, and has received strong support from the various agencies and local community for its project in Lumut.

For the first phase of its investment, Vale is spending US$1.4 billion (RM4.4 billion) to set up a regional distribution centre in Teluk Rubiah, Lumut, plus a designated port. The project is slated for completion in 2014 and will be able to handle 30 million tonnes of iron ore annually.

The Brazilian mining giant will ship iron ore from Brazil to Lumut and the raw material for steelmaking will then be distributed to its customers in the Asia-Pacific region.

The distribution centre includes a port that will be able to accommodate Valemax vessels — the largest dry bulk carriers in the world with a capacity of 400,000 deadweight tonnage.

Vale currently has 39 Valemax vessels that will transport iron ore from Brazil to Lumut once the port is ready in 2014. The company will be able to reduce its transport costs substantially with Lumut as a transshipment hub.

Out of the US$1.4 billion investment, Figueiredo said US$900 million has been tendered out with 69% given out to Malaysian companies.

“These are for jobs such as earthworks, piling, civil works, structure and facilities,” he said, adding that the remaining US$400 million is expected to be fully tendered out by the first half of 2013 for erection, dredging, sea structure, landscape and other works.

Figueiredo said Vale could invest up to US$5.6 billion in Lumut. “Apart from the US$1.4 billion earmarked for the first phase, Vale also included plans for the second and third phases in the master plan.

However, these plans will depend on the market then,” he said. He noted that Vale has the design and permits ready if it decides to embark on the second and third phases later.

“Some of these permits last 15 years. Whenever the market is ready, we can immediately respond as we have the permits and design in hand,” he said. He added that Vale might also consider setting up an iron ore pelletising plant in the future.

“Our plans here are similar to our investment in Oman. We have set up a distribution centre and pelletising plant there as well,” he said. He does not discount the possibility of local parties taking up stakes in its local venture.

“In Oman, local parties have a 30% stake in the pelletising plant. But we own 100% of the distribution centre there,” he said.