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MMC gets shareholders approval to acquire SATS

Posted on: March 24, 2009

Bernama – Saturday, March 21

KUALA LUMPUR, March 20 (Bernama) — MMC Corporation Bhd has obtained a 97 percent majority approval of its shareholders, to acquire the Senai Airport Terminal Services Sdn Bhd (SATS).

The company had received significant resistance from its minority shareholders towards the acquisition, as they expressed concern over the price valuation.

“Although the board had given an assurance that they would be accountable for the valuation, the minority shareholders were not convinced, because of the current environment,” Minority Shareholder Watchdog Group (MSWG) chief executive officer, Rita Benoy Bushon told reporters here today.

She was speaking to reporters after MMC’s extraordinary general meeting.

“I expect the board to look at the price valuation again,” she added.

In a statement released by MMC Corporation, the completion of the acquisition would result in it owning a 100 percent equity interest in SATS.

For the acquisition, MMC would pay RM1.7 billion in cash, comprising RM580 million for the Senai International Airport and RM1.12 billion for SATS’s 2,718 acres of freehold land, slated for development as an Airport City.

“We are acquiring SATS now at an early stage of its growth cycle. The price MMC is paying for the airport operations translates to RM395 per passenger.

“It is 55 percent lower than the average price transacted for airports of RM870 per passenger, for the past three years,” MMC CEO Hasni Harun said.

He said with the acquisition, MMC would own the only privatised airport in the country and it would create value for the group’s transport and logistics business.

SATS handled 1.46 million passengers in 2008 — a 10 percent growth over the 1.32 million passengers in 2007.

It expects continuing growth, attributable to increasing traffic, mainly driven by Iskandar Malaysia. — BERNAMA


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