MEASAT:Another One Goes Private

Ananda Krishnan is going for his third major corporate exercise in less than a year, this time involving the privatisation of Measat Global Bhd – at a cash offer price of RM4.20 or about RM668mil.

In a statement to Bursa Malaysia yesterday, Measat said Measat Global Network Systems Sdn Bhd, the entity controlled by Ananda, intended to undertake a conditional takeover to acquire all the shares in Measat not already held by Measat Global Network Systems for RM4.20 cash per share.

“The board has deliberated on the notice of the takeover offer and does not intend to seek an alternative person to make a takeover offer of the shares,” Measat said.

It received the notice of the takeover offer from CIMB Investment Bank and Maybank Investment Bank Bhd yesterday.

Trading in Measat, which last traded at RM3.80, and another of Ananda’s companies, Tanjong plc, was suspended yesterday ahead of the announcement.

Based on Bloomberg data, as at April 26, 2010, Ananda owned 59.56% of Measat Global through Measat Global Network Systems.

Based on the offer price of RM4.20, the proposed deal works out to about RM668mil for the remaining 40.44% equity Measat Global Network Systems does not own in Malaysia‘s sole licensed regional satellite system.

Sources said the decision was made after considering the huge capital that needs to be ploughed into Measat going forward, estimated at some US$1bil over the course of the next two to three years.

Said a source close to the proposed deal: “Things are changing so fast. Once the company puts up the infrastructure and builds the satellite, it takes about eight to nine years to repay the debt.

“About three to four years after, those satellites need to be replaced. It’s a high capital-intensive business and these days, we need more powerful satellites.

“The company still needs to bring in new capital and find ways to activate and synergise the orbital slots. It’s a wonderful opportunity for Measat to emerge as a global satellite entity which is substantially Malaysian-owned,” said the source.

With emphasis on that, it is believed that the company may be considering a possible equity tie-up with a foreign strategic partner.

“There are so many opportunities to create huge capacity. It’s not just about consolidation for capital requirement but expansion of business opportunities,” said the source.

Measat said the offer was conditional upon it being accepted by shareholders of not less than nine-tenths or 90% in the nominal value of the shares not already owned by Measat as well the consent or approval of relevant parties, if required.

The offer is valid for 60 days from the date of posting of the offer document, failing which the offer shall lapse and all acceptances shall be returned to parties who have accepted the offer.

The posting of the offer document would be within 21 days from the date of yesterday’s notice, Measat said.
Measat Global Network Systems does not intend to maintain the listing status of Measat in the event it is unable to comply with the required 20% shareholding spread of Measat’s issued and paid-up capital as a result of acceptances received pursuant to the offer.

When Astro All Asia Networks plc’s privatisation plans were revealed in March, Measat’s share price surged on expectations that it would be taken private.

I guess Ananda has found a willing buyer or strategic partner that will provide the funding for development while he reaps off his profit.

As usual,the minority share-holders are not given the benefit of the Section 108 tax credits.

What a shame.

Genting: Now It's the USA!

Gentings is now looking for investments in the U.S.

Justin Leong, the investment head chief at Gentings said that  “Genting Malaysia is aggressively searching for opportunities to invest in the U.S. casino gaming market.” He indicated that the strategy is towards building a US presence.

Armed with $1.7 billion in cash and debt free, Genting Malaysia is seeking acquisitions , new markets and potentially a strategic partnership in the U.S.

Earlier this month, it also bid to develop a slots casino at Aqueduct Racetrack in New York City.

It's foray into the US started with it buying MGM Mirage bonds.

The company bought MGM Mirage ’s secured bonds in May 2009 when the Las Vegas Strip’s biggest casino owner raised cash to avoid a potential bankruptcy. Genting Malaysia has invested in every capital issue by Las Vegas-based MGM since its first foray into the U.S. casino market. Apparently  that relationship will continue.
Genting Malaysia is also looking at developments and new gambling jurisdictions opening in the U.S.

The bid for Aqueduct “is another step.”

Kerkorian’s Stake

The investments include $100 million of bonds secured by MGM’s Bellagio and Mirage properties in Las Vegas, 9 percent notes tied to MGM Grand and MGM Mirage’s recently issued convertible senior notes.

Kirk Kerkorian , who founded MGM Mirage and is its biggest shareholder, said in October that his Tracinda Corp. is exploring “strategic alternatives” for its 37 percent stake.

The investor, 93, said in regulatory filings that MGM Mirage is undervalued and he is open to proposals.

Leong wouldn’t elaborate on Genting’s interest or say whether there have been talks with Kerkorian, whose stake in MGM Mirage is valued at $1.9 billion.

The shares rose 14 cents to $11.60 on June 11 in New York Stock Exchange composite trading and have gained 27 percent this year. Winnie Lerner , an outside spokeswoman for Tracinda, and Alan Feldman , a spokesman for MGM Mirage, declined to comment.

MGM Mirage and partner Pansy Ho hold one of the six casino licenses in Macau, the southern Chinese city that is the world’s largest gambling hub. Ho is the daughter of Macau casino billionaire Stanley Ho .

‘Faster, Sooner’ revenue from the Malaysian casino, a gambling monopoly held for almost four decades, helped build the Genting Bhd. empire that includes hotels, Star Cruises and Norwegian Cruise Lines, power generators and palm oil plantations.

In February, a Genting affiliate opened Singapore’s first casino, a $4.7 billion resort with a Universal Studios theme park , adding to the group’s Resorts World casinos in Malaysia’s highlands and the Philippines capital of Manila.

Genting also is the biggest casino owner in the U.K., operating under the Circus, Maxims and Mint brands.

There is competition for deals in Las Vegas as the city recovers from its worst economic slump on record.

Hedge fund billionaire John Paulson is acquiring a 9.9 percent stake in Harrah’s Entertainment Inc. In May, his New York-based Paulson & Co. said it owned 9.1 percent of MGM Mirage and 4.6 percent of Boyd Gaming Corp.

Genting Malaysia has held investment talks with large U.S. casino companies since December 2008, Leong said, declining to specify them. “I wish I had worked faster and done something sooner,” Leong said.

Leong, a nephew of Genting Chairman and Chief Executive Officer Lim Kok Thay and grandson of founder Lim Goh Tong , joined the family company in September 2004 after about four years at Goldman Sachs Group Inc.

Aqueduct Auction Genting is one of six potential bidders vying to renovate Aqueduct Racetrack and operate a slot machine-style “racino” with 4,500 video-lottery terminals in Queens. The latest round of proposals, which require a minimum $300 million up front, are due June 29. The family’s closely held Kien Huat Realty previously invested in three U.S. casino ventures, and last month partnered with the Mashpee Wampanoag Tribe to finance a proposed casino resort in Massachusetts.

In the early 1990s, Kien Huat financed the Foxwoods Resort & Casino in Connecticut, whose tribal owners defaulted on about $2.5 billion of debt last year, and the Seneca Niagara Casino in New York. In August, Kien Huat paid $55 million for 50 percent of Empire Resorts Inc. , owner of the Monticello Casino & Raceway in Monticello, New York, helping Empire to restructure some debt.

So,where do you think Gentings is heading? They have tentacles all over the world, so it seems!

Window Shopping at Suria KLCC

Well, what does one do with time on their hands if they do not need to follow an 8.30-5.30 job routine? Window shopping and catching in the sights of KL is one.

So after lunch, I set off for KLCC to wander around. After my wife had dispensed off her business with Tomei, we watch the O'brien boys produce Irish sandwiches. Not cheap, mind you. Cheapest on the menu was RM11.90.

We went to the Rasa Food court on the 4th Level for some cucuk udang and teh tarik. Not too bad.

Spent some time too at Kinokuniya Books and read some parts of a book on health and wellness. Cold Storage had some sort of sale on but we did not buy anything.

Came home at 5.30 pm.

I will be back next week again.

The Terubuk Fish

This is no fish to eat if you are afraid of fish with fine hairy bones. The closest relative is the parang.

Terubuk is well liked by the Malay community and are often roasted or deep-fried and eaten with some chili-onion-dark soya sauce dip.

I started eating terubuk this year after buying one from Mydin Hypermarket in Subang Jaya.

The flesh of this fish is certainly tasty and flakes off easily. In fact, you can say it practically 'melts' in your mouth as the flesh is soft and tender.

Whatever you do, just eat the fish carefully and gingerly. Do not ever attempt to eat it together with rice at one go because chances are, if you are unfortunate, you will get choked with an irritable terubuk bone sticking somewhere down your throat. Believe me, the experience can be most unnerving.

I remembered clearly what my mother said: the only way to get rid of it is by swallowing dollops of rice to dislodge it! Yes, it does work for me in bygone days- a frightful and painful procedure I could recall.