'Reading' faces of Asia's most prominent tycoons

This is the first of a three-part series featuring extracts and information from Faces Of Fortune, a new book that ‘reads’ the faces of 20 of Asia’s most prominent tycoons.

DO you know that simply by looking at a person’s face, you can tell his character and where he’s headed – that is, if you know the Chinese art of face reading, or Mian Xiang.

In ancient times, Mian Xiang was used by the emperors to choose imperial officers and masters, their disciples.

In Faces Of Fortune, author Tee Lin Say uses Mian Xiang to pick out 20 of Asia’s most prominent tycoons, and then explain why investors should place money on their companies over the next 10 years.

Datuk Seri Nazir Razak, CIMB Group

Datuk Seri Nazir Razak’s cheekbones pack willpower.

Nazir Razak is the youngest son of Malaysia’s second Prime Minister, and the brother of Datuk Seri Najib Tun Razak, the current PM. He is also the brainy group chief executive officer of the country’s premier investment bank, CIMB Group Holdings Bhd.

Early this month, speculation was rife that CIMB was thinking of acquiring RHB Capital Bhd. Now that this has come to an premature end, does this mean CIMB will be wedged in its consolidation phase, or are there bigger things in store from Nazir?

Looking at Nazir’s features, it’s pretty obvious that the best is yet to come for CIMB. We would safely say that the stock is a screaming buy at this point.

In 2012, Nazir will be 45 years old, or 46 in Chinese years. In Mian Xiang, this age point is represented by the left cheekbone.

The cheekbones represent not just Nazir’s age luck, but also his willpower and ability to wield power. And he sure has loads of that.

A major part of Nazir’s success at CIMB was achieved during his thirties, when the age points were in his eyes. But his eyes cannot quite compare with the width and size of his mouth.

In Mian Xiang, a big mouth signifies influence, power and lots of clout. Have you ever seen a tycoon with a small mouth? Rarely.

When Nazir turns 52, the age point will go to his superior mouth. So don’t be surprised if CIMB is an entirely different entity six years from now. It might even own an American bank by then!

We do not foresee organic growth for CIMB. Based on Nazir’s face, the company’s sensational ride will continue right into his fifties.

Tan Sri Quek Leng Chan’s most outstanding feature is his lips.

Tan Sri Quek Leng Chan, Hong Leong Group

Hong Leong’s Tan Sri Quek Leng Chan is famed for buying low and then selling for a tidy profit, a skill he has mastered over the years.

Investors may recall that in 2001, he pocketed RM11.bil – the highest price ever paid for an Asian bank – when he sold his controlling stake in Dao Heng Bank of Hong Kong to Singapore’s DBS Bank.

It certainly looks like the elusive Quek is coasting on second wind at the age of 71: Hong Leong recently acquired EON Capital Bhd for RM5.06bil, a move that makes it the fourth largest bank in Malaysia.

What is in his face that tells us this “master dealmaker” still has the appetite and drive for acquisitions and opportunities?

His triangle-shaped eyes burn with Sha-qi a fire that reveals “ambitions that need to be achieved”. Such eyes reflect a person whose mind is alert. He is hardly naïve and is unlikely to be swindled in the game of business.

Quek’s most outstanding feature is the corners of his lips. This area, known as the Jin Lu (meaning Gold Point), represents the ability to persuade or influence others, be it with words or sheer physical presence.

Quek’s Jin Lu is well-defined and long, a strong sign that we are looking at a man who is adept at making deals.

On top of that, his lips are flagged. A flagged mouth is one where the middle indentation on the upper lip forms the letter ‘M’. This denotes that Quek is very skilful in negotiation and has the gift of persuasion. What he says has a big impact on others.

Watch his moves as things are about to get very interesting for the Hong Leong Group.

Tan Sri Lee Shin Cheng has unique ‘killer eyes’.

Tan Sri Lee Shin Cheng, IOI Corp Group

Plantation conglomerate IOI Corp Bhd is currently involved in a tangle with The Roundtable On Sustainable Palm Oil (RSPO) over land disputes and illegal deforestation.

Some analysts say IOI’s reputation will be dented, and as a result, there will be downside pressure on the stock in the short-term.

Well, if only these analysts knew Mian Xiang. Then they would say that the dispute is merely a glitch when viewed alongside the grand slam that chairman Tan Sri Lee Shin Cheng is poised to deliver.

In fact, now is the best time to participate in the company’s growth because when Lee turns 73 in 2012, his luck cycle will improve substantially.

If you know face reading, you’ll see that Lee’s Mian Xiang is an open book of triumph because his face qi is glowing.

The easiest way to evaluate whether a person is experiencing good luck is to look at the qi of his face and eyes. Lee’s eyes are extremely sharp and alert. This signifies a strong spirit and hunger for more. The tips slant upwards, which shows that no detail escapes him. With such eyes, you can be sure that he’s still calling the shots in IOI.

Lee has one feature that is quite unique. Look closely and you will see a line that cuts into his Life Palace, that is, the space between the eyebrows. In Mian Xiang, this is called the Needle Piercing into the Life Palace.

You have to be pretty accomplished to handle the Needle. It pinpoints intelligence and shows that Lee is ahead of the game. Here is someone who is able to pick up cues before others even realise they are there.

Consensus on IOI’s stocks may be neutral now, but looking at Lee’s “killer” eyes, it’s obvious he will not be satisfied with rewarding shareholders with mere dividends.

‘Faces of Fortune: The 20 Tycoons To Bet On Over The Next 10 Years’ will be available at Joey Yap’s ‘Wealth & Destiny’ seminar in Kuala Lumpur on July 31, and leading bookstores from August. Visit masteryacademy.com or call 03-2284 8080.

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Parent firm gives IOI Properties the edge

Tuesday, June 23, 2009

Artist’s impression of Pinnacle Collection. Datuk Lee Yeow Chor (inset) says the company is closely monitoring the Singapore property market to ensure the timely launch of the projects

IOI Properties Bhd will be leveraging on the financial strength of its parent, IOI Corp Bhd, to build a greater presence in the Klang Valley and Singapore property markets.

Since being taken private in April, the 95.33% subsidiary of IOI Corp has greater liberty to plan and decide on the direction and projects it wants to undertake.

IOI Corp group executive director Datuk Lee Yeow Chor said although the level of activities would not change much from what the company had done previously, it was in a better position to leverage on the group’s financial strength to facilitate funding requirements for land acquisitions and move projects ahead.

According to Lee, property is all about holding power and having the financial strength to hold out and mitigate against the prevailing challenging market conditions, including slow sales; are important for property companies.

Despite the severe market crunch in Singapore since February last year, IOI Properties proceeded with the construction of its Seascape Collection residences on Sentosa Cove. The construction of the project has reached 40% to-date.

The 1.44-ha Seascape project is a 50:50 joint venture between IOI Properties and its Singapore partner, Ho Bee Investment Ltd.

It comprises two eight-storey condominium blocks of 151 units of various sizes, tentatively priced from S$2,500 to S$2,800 per sq ft.

IOI’s second project in Singapore, the Pinnacle Collection – which is 65%-owned by IOI Properties and 35% by Ho Bee – will be undertaken by Pinnacle (Sentosa) Pte Ltd. The 2.12-ha site was tendered for S$1.1bil.

The 99-year leasehold land is the final piece of condominium land to be launched by Sentosa Cove and has a maximum permissible gross plot ratio of 2.6.

The site will have seven 18-storey blocks and one 20-storey block of luxurious condominiums. It is one of the two condominium parcels flanking the entrance of the marina leading into Sentosa Cove.

Lee said the launch of The Pinnacle would depend on the take-up for the Seascape residences.

IOI has plans for a third project in the city state, comprising medium to medium high-end residences on a 1.44-ha site near Novena Square and Orchard Road.

He said the company was closely monitoring the Singapore property market to ensure the timely launch of the projects to optimise their value.

“The completion of the two integrated resorts in Singapore later this year will be the catalyst for further economic growth and market upturn in the city state,” Lee said.

In the last two months, the market for medium to mid-high end property in Singapore had shown encouraging signs of an upturn, he added.

Things are also looking up for the Klang Valley property market and demand is expected to recover by year-end.

For the financial year ending June 30, 2010 (FY10), project launches worth RM580mil have been lined up in the Klang Valley, including in Bandar Puteri, Bandar Puchong Jaya and IOI Resort.

A new greenfield development, Sierra Puteri, a mixed housing development on 194ha in the Seri Kembangan-Cyberjaya area, is also in the pipeline for launch in the first quarter of next year. There will also be a 22-ha commercial precinct in the RM2bil development. Lee expects the company’s property sales to bounce back from RM630mil recorded last year to RM650mil next year. This year, it expects to turn in sales of RM610mil.

“We will also be placing more focus on investment properties. For FY10, we expect more than 15% of the company’s earnings to come from property investment and the balance from property development,” he said.

Last year, income from property investment contributed 10% to the bottomline of IOI Properties and about 22% to 25% of IOI Corp’s earnings.

General manager for group operations Lee Yoke Har said besides leveraging on the good location of the company’s land bank and strong branding, it also emphasised on good community relations and programmes to promote wholesome living and safe communities in all its townships.

It set up a dedicated community website, Myioi.com, in 2000 that has become a popular communication tool for residents of its projects.

Other initiatives include the IOI Privilege card, which is a discount card offered to residents when they patronise any of the participating outlets in the townships.

“The next project to be rolled out will be free WiFi within our townships and ‘intercom connection’ for residents via the 015 IP phone,” she added.

By The Star (by Angie NG) (Posted on 22 June 2009)
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Malaysia IOI says worst is over for palm oil planters

July 2, 2009.

IOI Corp, Malaysia’s No 2 planter, said on Thursday that the worst was over for the plantation sector as palm oil prices have recovered from last year’s slump although M&A activity would be muted.

Earnings of Malaysian palm oil producers plunged in the first quarter as crude palm oil prices more than halved from a year ago.

IOI, valued at $8.37 billion, saw net profit nearly wiped out during January-March due to weak crude palm oil prices and large foreign translation losses on its U.S. dollar borrowings.

Sime Darby , Malaysia’s top planter, reported a 85 percent drop in net profit while third-ranked Kuala Lumpur Kepong saw net profit down 52 percent in the same period. “It’s quite obvious it will be better. The industry including ourselves expects to see much better fourth quarter (April-June) operating results,” IOI Executive Director Lee Yeow Chor told Reuters at the company’s headquarters in the administrative capital of Putrajaya.

Malaysia is the world’s second-largest palm oil producer after Indonesia.

Crude palm oil prices hit a record 4,486 ringgit a tonne in March 2008 before collapsing at the height of the global financial meltdown and triggering speculation that distressed plantation firms starting out would sell.

But Lee said the opportunities for merger and acquisition in the sector are hard to find now as the palm oil price recovery helped smaller firms hold out for better deals.

“Because the sharp price drop has not really been for a long time, the pressures on them (smaller planters), in terms of cashflow or repayment of bank borrowings is not so great.”

BRIGTHER OUTLOOK

IOI, which owns oil palm estates in Malaysia and Indonesia, saw net profit for the third-quarter to March plunge 94 percent to 37.36 million ringgit from a year ago on an unrealised forex translation loss of 232.4 million ringgit. [ID:nKLR496786]

The sharp drop in third-quarter earnings was due mainly to “a lot of translation adjustments” on its U.S. dollar debt, said Lee, adding that IOI expects the forex losses to reverse in the upcoming quarterly results.

“For fourth quarter with the weakening of the U.S. dollar, from end-March of around 3.63 ringgit, we expect to have some gains in currency translation for U.S. dollar borrowings,” said Lee.

“We borrow U.S. dollars, because it corresponds with our palm oil revenue, so that is a natural hedge between our borrowings and receipt of revenue,” he added.

BANKING ON ASIAN DEMAND

Palm oil prices have now recovered more than 60 percent from a low of 1,331 ringgit ($378.8) per tonne in October on surging Asian demand as well as tight Malaysian palm oil stock levels in the first few months of 2009.

“We have always thought that the low price level in the first quarter of this year was not a sustainable level to begin with. We have always expected the price to move up,” said Lee.

“The major consuming countries, China and India, their economies have not been that badly affected by the prevailing global downturn,” he said.

Lee said Malaysian palm oil production should pick up in the second half of the year due to the seasonal uptick in output as yield stress fades. He pegged June palm oil stocks at 1.5 million tonnes, an increase of 9.5 percent from a month earlier.

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Backers Don't Buy 'Friendly' Palm Oil

July 15, 2009

KUALA LUMPUR, Malaysia -- European consumer groups and nongovernmental organizations have said they want environmentally friendly palm oil. Malaysian producers of palm oil that have made the switch are discovering that it is still a hard sell.

The price premium for palm oil certified as produced through sustainable plantation practices has been shrinking since the first eco-friendly palm oil was shipped to European markets last November, and producers say it may need to disappear if they are to regain business in the key European Union market.

Producers say the difficulty in selling higher-priced sustainable palm oils highlights the double standards of those who criticize the industry but buy the cheaper, uncertified oil that they say is harming the environment.

"We [plantation firms] have complied with the strictest criteria on sustainability. The multinational companies, which also are end-users of palm oil, should not preach wine and drink water," said Carl Bek-Nielsen, vice chairman of United Plantations Bhd., the first Malaysian company certified as a sustainable producer.

Palm oil is a vegetable oil used in products ranging from margarine and cosmetics to feedstock for biofuel. It competes with soybean oil. Premiums for sustainable palm oil have shrunk to between $10 and $15 a ton, from $45 to $50 a ton before the global financial crisis took a toll on European economies late last year and demand waned, said Roy Lim, group plantations director of Kuala Lumpur Kepong Bhd., Malaysia's third-largest listed palm-oil producer by stock-market value. Noncertified palm oil currently sells for about $565 a ton, he said, already down more than 50% from last year's peak.

Consumer-goods companies like Unilever PLC, Nestlé SA and Kraft Foods Inc. repeatedly have said they would seek to buy palm oil produced with minimal harm to the environment. All support the goals and efforts of the Roundtable for Sustainable Palm Oil, formed by World Wildlife Fund and Unilever, which is adopting stringent and sustainable practices for palm-oil cultivation.

Although the combined annual production capacity of RSPO-certified producers in Malaysia, Indonesia and Papua New Guinea exceeded 1.57 million tons of certified palm oil and palm-kernel oil at the end of May, only 15,000 tons of certified oil has been sold since certification started late last year.

"At the moment, demand for certified palm oil is only 1% of the [produced] volume, so this has been disappointing for the growers and we feel the food companies should keep their end of the promise," said Lee Yeow Chor, executive director of Malaysia's second-largest palm oil producer, IOI Corp. Bhd.

IOI, KLK and United Plantations say they are committed to producing sustainable palm oil, even if the price premium disappears.

Nestlé remains committed to sustainable sourcing and only buys products derived from crude palm oil from reputable manufacturers, spokeswoman Nina Backes said.

Kraft spokesman Richard D. Buino said that while the company supports the RSPO's efforts, "it is clear more work is needed to consolidate standards, enforce principles, verify traceability along the supply chain and ensure competitive pricing to bring certified palm oil to market. We're monitoring the RSPO process and actively engaging our suppliers to monitor their certification efforts to find viable options for sourcing sustainable palm oil."

Neither Nestlé nor Kraft directly addressed purchases of Malaysia's certified palm oil.

Officials from Unilever, which purchases between 1.3 million and 1.5 million tons of palm oil annually, couldn't be reached for comments. The Anglo-Dutch consumer-goods giant announced in 2008 that it was committed to completely switch to certified palm oil by 2015.

Write to Shie-Lynn Lim at shie-lynn.lim@dowjones.com

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#3 Lee Shin Cheng

Net Worth $3.2 billion
Age 70
Marital Status Married, 6 children
Source palm oil

Former plantation field supervisor heads ioi Group, one of world's leading operators of palm oil plantations, refineries. Took its IOI Properties private in April. IOI's stock has doubled since November but still down a third since last year amid falling commodity prices.

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IOI's Strategic Shuffling Of Results

IOI Corp Bhd posted a 93.8% drop in net profit to RM37.36mil in the third quarter of its financial year ending June 30, compared with RM601.64mil in the corresponding period last year. The decline was mainly due to unrealised forex losses and lower contribution from its manufacturing and property business.

The company’s revenue dropped 12.2% to RM3.096bil in the third quarter compared with RM3.525bil a year earlier. Earnings per share was 0.63 sen versus 9.89 sen previously. The company declared a dividend of three sen for the quarter. IOI Corp said overall, the group’s results for the current financial year were expected to be lower than the previous year’s record but still satisfactory in the light of current conditions.

In a filing with Bursa Malaysia yesterday, the company said its plantation segment reported a 6% increase in operating profit to RM1.38bil for the nine months of the current financial year, compared with RM1.3bil in the same period a year ago. “The better performance is due mainly to higher CPO prices realised from the forward sales entered into during the second half of financial year 2008,” the company said. Its resource-based manufacturing operating profit was significantly lower at RM169.1mil for the nine months of the current financial year compared with RM457.4mil in the same period last year.

“The lower profit is attributable mainly to realised foreign exchange losses and customer defaults on high priced contracts incurred during the first half of the financial year and lower sales volume due to the unfavourable global economic conditions,” the company said. The property segment’s operating profit of RM200.5mil for the nine months of the current financial year was 35% lower than in the same period last year. It added that the decrease was mainly due to the soft property market conditions and lower margins.

Overview - The principal activities of IOICORP consist of investment holding and the cultivation of oil palm and processing of palm oil. The principal activities of the subsidiaries are cultivation of oil palm, processing of palm oil, trading in commodities, property development, property investment and investment holding.

Oil palm plantation is one of IOICORP's core businesses as it contributes over 40% to the company's profit. IOICORP manages about 100,000 ha of oil palm plantation with approximately 65% of the plantation in Sabah and the rest in the peninsular.

The company also owns ten crude palm oil mills to produce crude palm oil and palm kennel. Through its 65% owned subsidiary, IOI Properties Berhad, IOICORP is involved in property development and investment, which is another major profit contributor to the company. The company has undertaken several mixed development township projects, which include Bandar Puchong Jaya and Bandar Puteri Puchong in the Klang Valley and Bandar Putra Senai in Johor Bahru. In addition, IOICORP owns 1.7mn sq ft of lettable retail and office space. Meanwhile, the company is also involved in the manufacture and trading of fatty acids, glycerine, soap noodles and metallic stearates through its 59% owned subsidiary Palmco Holdings Berhad.

Ratings Downgrade - Moody's Investors Service has changed IOI Corporation Bhd's outlook to negative from stable for its Baa1 issuer rating. At the same time, the outlook for the Baa1 senior unsecured bonds and loans issued by IOI Ventures (L) Bhd, which are guaranteed by IOI, have been revised to negative from stable. "The rating action has been driven by IOI's recently reported weaker profitability which is mainly the result of higher than expected foreign exchange losses and customer defaults amid declining crude palm oil prices," said a Moody's Vice President.

"These losses have prompted Moody's concerns over weakness in the company's internal management system especially in effectively controlling its foreign exchange exposure. In addition, the outlook for IOI's two major business lines --- resource based manufacturing and real estate development -- are expected to remain challenging over the next 12 months which may continue to pressure its profitability," he said.

IOI's current ratings are supported by the favourable long-term outlook for palm oil demand; position as a global top-tier palm oil producer and efficient operations; good access to capital and bank markets as well as the management's good track record in managing the palm oil business throughout the business cycle. IOI's strong liquidity is also supportive of its current rating.

Downgrade pressure on IOI could emerge if pressure on its downstream operation margin continues resulting in protracted weakness in profitability, such that earnings before interest, tax, depreciation and amortisation (EBITDA) margin remains below 19 percent; and weaker palm oil production from some of its aging plantations results in a material reduction in the profitability of its plantation segment, Moody's said.

The outlook could return to stable if IOI can demonstrate effective internal measures to minimize its foreign exchange risks and bad debt losses, as well as generate positive free cash flow to reduce its debt leverage such that its Debt/EBITDA is not exceeding 2.5-2.75 times. The last rating action with regard to IOI was taken on Dec 2, 2008, when the company's issuer and debt ratings were downgraded from A3 to Baa1.

Verdict: No big deal. The stock is still some 40% off its 12 month high. Its a good sign that they are whacking all the losses onto this quarter. This will get rid of all the bad news in one shot. Expect a good showing in the coming quarters. Operations wise the company has already sold forward 80% of its FY09 CPO production at an average price of RM2,700 (till June 2009). Now they are selling FY2010 production but the company seems to think that there is a good chance that they can get RM3,000 in 2H of 2009. Operating cost is still just RM1,100 and may actually average closer to RM1,000 for the rest of the year. This represents a good pick up level.

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Raw deal for IOI Prop’s minority shareholders

Analysts believe they deserve better offer

PETALING JAYA: There is little doubt about IOI Corp Bhd’s Tan Sri Lee Shin Cheng’s ability to seize an opportunity when he sees it.

The plantation group’s executive chairman and CEO’s move to buy out its property arm may not surprise many, but some analysts feel IOI Properties Bhd’s minority shareholders deserve a better deal.

“We advise investors to sell the stock (IOI Prop) into strength,’’ CIMB Research said in a note to clients yesterday. The firm was “not keen” to swap IOI Prop’s shares for IOI Corp, but noted that the “alternative may be even less palatable.’’

IOI Corp late Wednesday offered to buy the remaining 199.7 million shares from IOI Prop minority shareholders at 0.6 share in IOI Corp at market price plus 33 sen cash per IOI Prop share.

This means that the offer price will fluctuate with IOI Corp’s share price movement. Shares in IOI Corp plunged 24 sen yesterday to RM3.68, while IOI Prop shot up 27 sen to RM2.49.

CIMB has a target price of RM3.20 for IOI Corp.

It opined that IOI Corp was “overvalued” at Wednesday’s closing price of RM3.92. It also argued that based on CIMB’s target price, the offer would equal RM1.92 worth of IOI Corp’s share plus 33 sen cash.

This works out to RM2.25 per IOI Prop share.

Maybank Investment Bank analyst Ong Chee Ting believed IOI Corp risked “low take-up rate” for its offer. Ong has a target price of RM2.90 for IOI Corp.

“Although it is unlikely to go down well with IOI Prop’s minority shareholders, the delisting would encouraged them to sell’’ as they won’t risk holding shares in an unlisted company, he said.

The deal breaker, however, are the government-linked funds Valuecap, Permodalan Nasional Bhd and the Employees Provident Fund, which collectively hold an estimated 10% stake in IOI Prop.

“If they act in concert and reject the offer, IOI Corp won’t be able to get the 90% acceptance,’’ said Tan Ting Min, an analyst at Credit Suisse Securities Malaysia wrote in a note yesterday.

He believed, however, that the market would see the privitisation as “marginally positive” for IOI Corp as it was value enhancing.

Credit Suisse upped its target price for IOI Corp from RM3.27 to RM3.31 yesterday.

IOI Corp needs to increase its stake in IOI Prop to above 90% to take the company private. Even if it failed to get the required number, IOI Corp said on Wednesday, it intended to take the requisite steps to delist IOI Prop from Bursa Malaysia.

“We believe the offer is fair, if not favourable, bearing in mind that IOI Prop may need to provide for impairment charges for its Sentosa Cove projects (in Singapore).’’ HwangDBS Vickers Research said in a report yesterday.

Based on Bloomberg’s consensus estimates, the IOI Corp offer was 36% below IOI Prop’s book value of RM3.63 and valued the company 8.9 times its forecast earnings for the year ending June 30, 2009.

Historical data showed that IOI Prop shares had been consistently traded above its book value since early 2000 until the middle of last year when equity prices worldwide collapsed.

“We lament the privatisation or delisting of IOI Prop as the company is one of the largest and most profitable developers in Malaysia and has been a benchmark and role model to many,’’ CIMB said.

The firm said IOI Prop’s revised net asset value stood at RM6.15 per share, or RM5.2bil. At yesterday’s close, its market value was RM2.07bil.

If the deal goes through, IOI Corp will fork out about RM64mil cash and issue some 116.9 million new shares at market price for the additional 24% stake in IOI Prop.

The deal, pending approvals from shareholders of both companies, is targeted for completion by end-June.

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Change In Profile But Not Values

Lee Yoke Har's resemblance to older brother Datuk Lee Yeow Chor is uncanny. Soft-spoken and affable, her quiet strength and firmness are very similar to her sibling's when it comes to dealing with the issues of the day.

The children of IOI Corp Bhd's executive chairman and CEO Tan Sri Lee Shin Cheng, Yeow Chor is group executive director of the IOI group of companies and executive director of IOI Properties Bhd, while Yoke Har is the general manager of its legal and general operations department — a position that has enabled her to stay out of the public eye.

Two months ago, however, Yoke Har, who has been with the group for 13 years, donned another hat. She took over the marketing operations of the group's property division, which is a hot seat indeed, given the current tough property market conditions.

"I am not a corporate person," Yoke Har stresses to City & Country in what is her maiden media interview. "Please focus on the exciting projects and plans we have to share with you…

" She reports to IOI Properties' executive director Datuk David Tan, a trusted chieftain of the Lees and who has been with the group for ages. Then there are her brother and father.

With Yoke Har spearheading the marketing portfolio for the property division, Tan is free to focus on other equally demanding chores, with project management being a priority.

"He has a lot on his plate and he needs to juggle his time a lot," explains Yoke Har, whose newly put-together team oversees the marketing of key Klang Valley developments, comprising those in Puchong and Klang and IOI Resort in Putrajaya.

The changes being effected are aimed at coordinating and expediting decisions so that the developer can move at a fast clip. Raising the profile of IOI Properties — a brand that is synonymous with dependability and being conservative and low profile — is also in the works.

Says Yoke Har: "We want people to know us... It is high time there was coordinated effort to do this. Our style has always been to do things quietly; do it well and people will know. (But it has been) too quiet. This has been going on for years. But our values have not changed…"

For IOI Properties, indisputably a top Malaysian property developer that has been active since 1982, the changes are perhaps overdue, seeing how the demands of property investors have surged in recent times.

No, the changes are not a knee-jerk response to the troubles ailing even the most established players across the globe, says Yoke Har. In fact, she sees the property market bottoming out in nine months. "There is liquidity; people are holding back for fire sales but this has not happened." With the property market getting more crowded and the investment climate more jittery, even the unobtrusive IOI Properties is reviewing its strategies, going forward. This is necessary because the developer plans to launch some RM500 million worth of properties in the Klang Valley this year. The offerings will come from Bandar Puchong Jaya, the newer Bandar Puteri Puchong and Bandar Puteri Klang. In Bandar Puchong Jaya, which sprawls over 1,000 acres, more upmarket homes, like the 2½-storey superlink Vistaria Residences, have emerged in the residential component. The next six months will see the launch of sixty 2½-storey semi-detached homes and light industrial units here. Meanwhile, almost 80% of the 930-acre Bandar Puteri Puchong has been developed. It will unveil thirty-six 2 and 2½-storey bungalows and seventy-eight 3 and 4-storey shopoffices over the next half year. Over in Bandar Puteri Klang, new homes and shopoffices will be rolled out from end-February. In short, IOI Properties is not about to put a stop to new launches.

PUCHONG FINANCIAL COMMERCIAL CENTRE

So, exactly what is going to be different about the developer? For starters, it will embrace fresh and compelling development concepts and designs. Add to the concoction a loyalty programme designed to reach out to and please both buyers and occupants to secure repeat buying.

The new and bolder designs are evident in the upcoming Puchong Financial Commercial Centre (PFCC) taking shape diagonally across the Damansara-Puchong Highway (LDP) from the IOI Mall. Work on two of the five PFCC towers on an eight-acre freehold tract is slated to be completed this April. "These are not very high — 11 and 20 storeys. But you will not miss them as you drive along the LDP," says Mohd Ezuddin Sami'an, IOI Properties' marketing manager.

"They are iconic… they stand out from the other buildings in Puchong.

" Puchong has too many traditional shophouses and offices, says Yoke Har. She is confident a "happening" PFCC, with its contemporary design incorporating environmentally friendly features, will lift Puchong's image to even that of Bangsar.

Looks and design aside, the developer is counting on the proximity of Cyberjaya as drawing point. However, a building can only be audited as a Cyberjaya Centre upon its completion. "We are confident of getting the status," says Yoke Har, adding that the building designs have incorporated the necessary criteria.

While the original plan was to build all the five towers in four to five years, the timeline had to been tweaked to seven to eight years in the light of the current global credit turmoil. So, the developer is improving the designs of Towers 3, 4 and 5, based on the experience and feedback from the nearing completion of Towers 1 and 2.

Combined, the five towers will offer a net lettable area of 1.15 million sq ft. The 12-storey Tower 1 (built at RM35 million) will have 125,000 sq ft, and the 20-storey Tower 2 (built at RM70 million) 253,000 sq ft. In all, there will be 1,920 parking bays in the basement, all of them interlinked.

The developer has tagged an average RM600 psf for Tower 1, while it intends to keep the LDP-fronting Tower 2 for investment. Office space in Tower 2 is being leased out at an average of RM4 psf, while the retail space is going for RM6.50 psf or so.

It is worth noting that weak market sentiment notwithstanding, two local parties have shown interest in the buildings, with talks already in the second stage. One party is looking at leasing Tower 1 en bloc while the other is exploring a buy-and-lease-back option for Tower 2.

"We are flexible; we cannot be leaving the buildings empty for six to nine months, so if the price is good, we don't mind selling..." says Yoke Har, without disclosing the numbers now on the table. One of the parties is looking at relocating its operations, while the other is expanding and relocating its business.

IOI BOULEVARD

About a kilometre down the thoroughfare from PFCC, workers are putting the finishing touches to IOI Boulevard, a hybrid office-retail/lifestyle development modelled after London's Covent Garden. "Business sophistication" and "stylish entertainment" are some of the developer's taglines for this development that comprises six blocks of office-cum-retail space. Enclosed within is the Palette, which comprises thirty-six 2-storey retail outlets that look into a 108ft by 240ft courtyard. "This will be a platform to promote arts. Budding artists, musicians and photographers, for example, can showcase their work here free of charge. We will also build a stage in the courtyard, which will be shielded by a tinted, high glass ceiling," says Yoke Har, adding that they have factored into the design the need for air to circulate.

The developer has tied up with LimKokWing University, whose students will paint two murals in the Palette. IOI Properties is also working with the Puchong Orchestra to explore ways to promote the latter.

Of the six office-retail blocks, all equipped with individual lifts, the developer plans to keep two, both fronting the LDP for recurrent income. Since its launch last June, 60% or 262,000 sq ft of the total saleable area of just under 446,000 sq ft have been sold at an average of RM450 psf, with the ground floor retail space going for RM980 psf. Space at the Palette is leased at an average of RM6 psf. In all, IOI Boulevard offers a total net lettable area of about 730,000 sq ft, with another 133,000 sq ft in retail space at the Palette.

IOI Boulevard is targeted for completion in April and is likely to be opened in May. It will be interesting to see how much IOI Properties can do to bring arts to live in Puchong.

SIERRA PUTERI

Outside the Puchong boundary closer to Sepang, earthworks for a 485-acre mixed development township with a gross development value of RM1.6 billion called Sierra Puteri, have been completed. Construction will start as soon as the authorities approve the building plans. The gated development on undulating grounds will boast designs in departure from IOI Properties' norm. However, the layout will still be functional, says Yoke Har.

The lower-density units will be designed after precincts, each of which with its own park. There will be lots of buffer parks, she continues. The maiden launch, featuring the traditional 2-storey 2ft by 75 ft terraced homes, has been slated for the second quarter this year at a pricing she declines to reveal immediately.She would however only say that it will be priced at a premium to the conventional link homes in the close by Equine Park.

IOI Properties' move to go slightly up markat at Sierra Puteri makes sense given the abundant traditional offerings coming up in Equine Park. IOI Properties' target market: Puchong and Kajang upgraders and those staying in Serdang of course.

IOI FAMILY

Fostering loyalty in customers is an integral part of marketing and it is no different for developers. Come late March or April, IOI Properties will unveil its loyalty programme, which will see some 85,000 IOI Privilege Cards distributed, in the developer's two townships of Bandar Puchong Jaya and Bandar Puteri Puchong.

The cards will be given out free to those in the catchment area to shop, dine and enjoy other services for less in participating shops in Puchong, where the developer has built some 1,700 commercial units.

The developer will also take on the role of promoting the participating outlets, which are expected to offer 10% to 15% discounts or privileges in kind for a year. So far, 60 outlets have signed up. Potential candidates are tenants in IOI Mall — 199 in the old wing and another 100 in the new extension, which at press time was awaiting its certificate of fitness. The extension expands IOI Mall's 650,000 sq ft of net lettable space to about a million sq ft.

Yoke Har is particularly excited about the loyalty programme and it is easy to see why. A thriving township can only equal an appreciation in capital values and yields. And happy investors could potentially translate to repeat buyers. So clearly, IOI Properties is the ultimate beneficiary of the programme, if it works.

The community-based programme, Yoke Har points out, is an extension of the developer's community services which it undertakes seriously and with commitment. "We have been working a lot behind the scenes. Do you know we have someone dedicated to working with the residents' associations in Puchong? Besides our website, we also publish a bi-monthly residents' newsletter called Reach Out…"

"We want to make residents feel privileged. At the same time, we are supporting the business operators in our townships as part of our after-sales service. The programme makes sense — these are self-contained townships; everything one needs one can find there. The convenience, the variety, now the pricing with the discounts offered," she adds.

Yoke Har does not discount the possibility of the IOI Privilege Card being used by third parties, which augurs well for the participating businesses. Obviously, the plan to extend the coverage of the loyalty programme is on the cards.

IN THE PIPELINE

Traditionally a township developer, IOI Properties has withstood the test of time and thrived on the legacy of its developments. Recurrent income from property investments and property management fees now help make up the property division's 30% or so contribution to IOI Group's earnings. The ratio, Yoke Har says, is going to change with more emphasis on property, but she is unable to immediately provide the numbers.

IOI Properties is also active outside the Klang Valley, for example Singapore, although plans there have been deferred given the current downturn.

Another project to look out for is a mall planned for Putrajaya, the details of which the developer declines to divulge for now. All said, IOI Properties is geared to give competitors a run for their money.

Source: The Edge Daily

Planters urge government to help stabilise palm oil prices

KUALA LUMPUR, Nov 25 - Malaysia's top plantation companies have suggested government incentives for industries to switch to palm bio-diesel as well as burning the oil as feedstock to generate power as part of initiatives to stabilise prices.

The proposals come in the face of excessive crude palm oil (CPO) supplies at a time of slowing demand and prices a third of their peaks.

Giving their full support for the government's initiatives to allocate RM200 million to replant 200,000 ha of ageing trees, the planters said factories and even fishermen - currently on diesel subsidies - could shift to CPO use with the right incentives.

"The more oil we can consume in the country, the greater the chances of stabilising the price of palm oil," said Kuala Lumpur Kepong chief Lee Oi Hian.

KL Kepong, along with IOI Corporation, Sime Darby, United Plantations, Felda Holdings and Boustead Holdings, produce about 60 per cent of Malaysia's total CPO.

Following a meeting of the players yesterday, the company heads told a media conference that despite the "very challenging period", they were still profitable at current CPO prices of around RM1,500 per tonne and
not in a 'distress situation'.

"We are still making profit although we may not like those profit figures," quipped Lee.

IOI executive chairman Lee Shin Cheng said he expected prices to recover and to average RM2,000 to RM2,400 next year.

Even so, with about two million tonnes of stock and prices close to breakeven point for the less productive planters, the companies with the backing of the Malaysian Palm Oil Board are looking to a RM500 million
price stabilisation fund to maintain prices.

One of the world's largest palm oil producers, Malaysia's annual output should hit an estimated 17.5 million tonnes, but global demand has shrunk in the economic downturn despite the vegetable oil's huge discount of up to US$250 per tonne to soya oil.

"The industry is asking if we can put part of the money available to support the price," Lee said of the RM300 million that remains of the fund, given that RM200 million would go towards replanting efforts.

Whether the government agrees to the suggestions, which have yet to be formally presented, remains to be seen - but national utility Tenaga Nasional has pointed out it is not feasible to use CPO as feedstock given
it would cost more than coal.

In February, the government plans to implement the use of blended bio-diesel fuel in government vehicles, and analysts estimate the production of the B5 biofuel with 5 per cent palm oil would remove 500,000 tonnes of palm oil annually when fully implemented in early 2010.

The planters who want fertiliser costs reduced by half said they would adjust costs by reducing the amount of fertiliser used. Fertiliser accounts for half the production costs but it has increased two-fold since the beginning of the year. - Business Times Singapore

Of oil palm, douches, insects and Tamil songs

YOU can always tell a planter's hands. They are big, calloused, wrinkled and very, very strong.

When I first shook hands with Datuk Leslie Davidson, a 77-year-old former planter, I was left with numb fingers before blood flowed into my right hand.

In an interview with Davidson and Mahbob Abdullah, his friend and former subordinate, both talked about their upcoming books.

Scheduled to be launched in early 2009, the books tell of their amusing and poignant experiences as planters in the tropics between the 1950s and the 1980s.

Davidson was also in Kuala Lumpur to receive the Merdeka Award from Prime Minister Datuk Seri Abdullah Ahmad Badawi for his outstanding contribution to Malaysian people.
The Merdeka Award, a Petronas initiative co-founded with ExxonMobil and Shell, came with a trophy, certificate and RM500,000 cash.

Davidson's contribution could be attributed to efforts 30 years ago when he initiated efforts to get weevils, insects from Cameroon, to pollinate oil palm trees in Malaysia. Since then, the oil palm trees have been merrily producing more fruit bunches, making Malaysia the world's biggest palm oil exporter.

As Davidson sat himself down beside Mahbob, he said, "the Merdeka Award is actually a team effort".

I stole a glance at Mahbob. "My boss is right. Maybe the award money should be divided among team members, too," he said, and laughed, "there were thousands of us".

In chapter 10 of Mahbob's book titled "Planters Tales" and chapter 37 of Davidson's "East of Kinabalu", they tell how oil palm companies had to spend a lot of money to hire hundreds of workers just to manually harvest pollens from male flowers of oil palm trees to pollinate female flowers.

Teams of workers patrolled the estate daily searching for male flowers to collect the pollens. This was then issued to other teams who went around pollinating every receptive female flowers with hand puffers.

"Ironically, by trial and error, we found the ideal instrument for this delicate operation to be vaginal douches," he said.

When Davidson submitted orders for vaginal douches, Unilever headquarters in London was very surprised and immediately questioned if he was carrying out birth control programmes among his estate workers.

Davidson promptly replied, "Oh, quite the contrary, we're actually trying to increase fertility rates among the trees to get them bear more fruits".

While top management approved of the orders, Davidson was constantly reminded that Sabah estates' oil palm yields were lower than in Johor and Cameroon.

Undeterred and unconvinced by textbook knowledge which claimed that palm fruits were wind-pollinated and that heavy rain washes pollen away, Davidson arranged for more research to prove that pollination in West Africa was largely due to weevils which were not found in Malaysia.

Under Davidson's instruction, Dr Kang Siew Ming, Zam Karim, Dr Tay Eong Beok and Mahbob went to Cameroon to assess the work of Dr Rahman Anwar Syed, the entomologist who was assigned to study oil palm pollination by insects in Africa, especially the Elaieidobius kamerunicus specie.

"It ended up with the two ladies Dr Kang and Zam climbing the oil palm trees," Mahbob said.

Asked what he and and Dr Tay did while the ladies were up on the trees, Mahbob replied, "we stood underneath and made sure that they didn't fall down".

Jokes aside, Mahbob is most probably remembered among members of East Malaysia Planters Association for being the very persuasive money collector for the RM2 million weevils project.

The Unilever Group was the first to pay but Sabah Land Development Board was the biggest contributor.

Incidentally, the estates that Davidson and Mahbob used to work and live in Johor and Sabah are now owned by IOI Corp Bhd. To this day, the almost 70-year-old IOI Group executive chairman Tan Sri Lee Shin Cheng still makes his regular rounds at these estates.

Lee's talent in serenading Tamil songs to his oil palm trees may seem surprising to many but it reflected Incorporated Society of Planters (ISP) requirement that all planters must be proficient in commonly-used languages at the estates.

Davidson recalled preparing for the Malay and Hakka language tests almost 60 years ago. At that time, the ISP examiner said, "You will find Hakka very useful in North Borneo," and asked, "Nyi thuk-ko-kai shu, han ki-tet mau? (Do you still remember your studies?)"

Davidson replied, "Yit pan ki-tet, yit pan mong-ki liau. (Half remember, half forgotten.)

The examiner liked what he heard and Davidson passed the Hakka test with flying colours.

Mahbob was also lucky. In his second book entitled "Planter Upriver", Mahbob told how he was slow to start learning Tamil but eventually aced the test.

At that time, Mahbob's contract as an assistant manager at Tanah Merah Estate in Tangkak, Johor, required him to pass the Tamil language test. He found a very patient tutor in Krishnan, an 18-year-old son of a worker. Also, Mahbob's love for Tamil and Hindi movies might have helped.

Asked if he is able to sing Tamil songs, he winked and smiled, "If Tan Sri Lee invites me to his estates, I certainly don't mind a duet".

Source here

Property groups find asset sales tough going

A SERIES of aborted divestments by Singapore property groups lately highlights the challenges of relying on asset sales in the current environment.

Last weekend’s edition of BT featured two stories on the same page, on Singapore’s two biggest listed property groups - CapitaLand and City Developments Ltd (CDL). Both are in the same boat, with their respective planned divestments of overseas assets not completed.

CDL’s London-listed hotel subsidiary Millennium & Copthorne Hotels announced that the agreement for the disposal of Millennium Seoul Hilton hotel to Korean group Kangho AMC Co had been terminated as the buyer was unable to finalise its financing arrangements amid the global financial turmoil.

CapitaLand’s 30 per cent-owned associate Inverfin Sdn Bhd, which owns Menara Citibank tower in KL, reported that the sale-and-purchase agreement for the sale of the office tower had been terminated as the buyer, IOI Corporation Bhd, did not pay the balance purchase price on the completion date.

There have also been instances of transactions of Singapore buildings not being completed. Ho Bee announced last month that its proposed $30 million sale of Frontech Centre, an industrial building in Bukit Merah, had fallen through. The buyer is understood to have been US fund group Angelo Gordon. BT also reported last month that Australian property fund manager Blaxland did not go ahead with completing its planned acquisitions of eSys Technologies’ building in Changi North and SH Cogent Logistics’ warehouse building in Penjuru Close in Jurong.

The pullouts reflect the difficult conditions for property investment sales, caused by several factors. Firstly, funding is tight. But even potential buyers with financial muscle may get cold feet or decide it simply makes more sense to walk away from their purchase now and forfeit the deposit, as sliding property values will present more attractive investment propositions in due time. There may also be other issues at play, such as exchange rate fluctuations. For instance, from a potential buyer’s perspective, the Aussie dollar’s 21 per cent depreciation against the Singapore dollar in the past three months would make purchasing Singapore properties less attractive.

Putting things in perspective, a seasoned property consultant said: ‘The current climate makes asset sales difficult, whether you’re selling an apartment or a shopping centre.’

Property groups will have difficulty selling assets even to their sponsored real estate investment trusts (Reits). With the stockmarket slide, Reits are trading at very high yields, which makes it difficult for them to make yield-accretive acquisitions. And the current tight funding environment affects Reits as well; their priority these days is refinancing existing debt instead of sourcing new debt for further acquisitions.

The situation is likely to continue for at least the new few quarters; that will have implications for Singapore’s property groups. Heavyweight CapitaLand has booked handsome profits from divesting assets in the past few years. In the past two years, the group has divested some $9 billion of assets - an exercise that has generated well over $1 billion in profits.

The group still has other assets that it could potentially divest, such as its industrial property portfolio here and even some of the office blocks held by its sponsored Reit CapitaCommercial Trust.

Prior to the global financial crash, CapitaLand would have had a high chance of success if it had continued on its path of asset disposals. Now, buyers are scarce and even those that are around would demand distressed sale prices (as cushion against further declines in property values after their purchase).

The trying financial climate will affect asset divestment strategies of even a heavyweight like CapitaLand. But at least it has stronger financial muscle to weather this storm even if it can’t make major divestments in the near future.

Smaller players are not in the same boat. Some companies burdened with heavy debt and which had been hoping to unload some of their properties to improve their balance sheets will be caught if they can’t sell their assets.

Hopefully, the malaise in the property investment sales market will not drag on too long.

Source : Business Times - 2 Dec 2008

IOI aborts Menara Citibank purchase

by Khalil Adis

IOI Corporation Berhad´s has aborted its proposed RM586.7 million acquisition of Menara Citibank, causing it to forfeit an earlier payment of RM73.4 million, the company has revealed in a statement.

The company cited the worsening global financial crisis as the reason why it has decided to call off the acquisition.

“Due to the recent sudden adverse developments in the global economic environment which have spread to this region and impacted negatively on business sentiments, the company has, after due and careful deliberations, decided that it would be in the overall best interests of the company and its shareholders not to proceed with the proposed acquisition,” IOI Corporation said in a statement.

IOI Corporation made agreements with the various vendors last August comprising Citigroup unit, Menara Citi Holding Company Sdn Bhd (50 percent), CapitaLand (30 percent) and Amsteel Sdn Bhd (20 percent).

It became unconditional on 31 October and the due date for payment of the balance of the purchase price was 11 November.

IOI Corporation then received a letter from the vendors´ solicitors dated 26 November, stating they were terminating the agreement with immediate effect. The sum of RM73.4 million paid earlier, together with accrued interest, was forfeited as liquidated images.

IOI Corporation said it is currently seeking seeking legal advice as to the propriety and quantum of the aforesaid forfeiture.

Plantation firms to buy more land

CPO price downtrend provides opening for expansion

PETALING JAYA: Cash-rich local plantation companies will actively expand their land bank within the next five years via acquisitions of green fields, existing oil palm plantations and distressed planters.

Analysts believe the current downtrend in the crude palm oil (CPO) prices would provide local planters the advantage in sourcing for more attractively priced plantation land in favourite locations like Sabah, Sarawak and Indonesia.

The commodity boom over the past five years saw many tier-one and tier-two local planters accumulating healthy cash in the range of RM450mil to over RM1.4bil.

Of late, plantation giants like IOI Corp Bhd, Sime Darby Bhd and Kuala Lumpur Kepong Bhd, which each has a cash pile of over RM1bil, have indicated strong intentions to progressively expand plantation hectarage.

Major planters like Kulim (M) Bhd, Hap Seng Plantations Bhd, IJM Plantations Bhd, Asiatic Development Bhd and Ta Ann Holdings Bhd are also in the midst of acquiring more land bank.

Jupiter Securities head of research Pong Teng Siew told StarBiz that plantation companies had not been actively paying out the best dividends, particularly last year.

“Many seem to be hoarding their cash to embark on new land bank acquisitions.”

Production gain is slow in production.

Said Pong: “Planters need to grow by acquiring more land bank and progressively undertake replanting activities with high yielding clones.”

He concurred that land bank acquisition was the major strategy of local oil palm planters.

In Sabah, plantation land can fetch up to RM15,000 to RM16,000 per acre currently compared with only RM5,000 per acre in the late 1990s.

Sarawak plantation land is even higher at RM18,000 to RM20,000 per acre.

As for Indonesia, the land price is about half Sabah’s prices.

Pong said the major obstacle faced by most Malaysian plantation companies in the republic was mainly the land ownership issue despite the availability of huge tracks of plantation land.

IOI Corp group executive chairman Tan Sri Lee Shin Cheng recently said the group was keen to acquire more land in Malaysia rather than Indonesia.

“Given the current market uncertainties, we prefer to increase our land bank in Malaysia but in Indonesia, we will continue with new planting efforts,” he added.

His view was shared by Hap Seng Plantations group managing director Edward Lee Ming Foo.

Lee was quoted recently as saying that Hap Seng Plantations was looking at expanding its acreage in Sabah, where most of its plantations are located.

Planters that are still gung-ho over Indonesia’s prospects include IJM Plantations and Sime Darby.

Sime Darby group chief executive Datuk Seri Ahmad Zubir Murshid said recently the group was eyeing green field plantations in Indonesia. It will also consider buying distressed plantation companies.

Memories My first replanting

We had an area of very old rubber.The area had been abandoned from tapping very much earlier.The stand was old rubber seedlings,many very huge trees and I estimated the stand per acre was slightly more than a hundred.

The inter-rows was in horrible state,full of wild grown wild rubber seedlings.The sized of these seedlings were beyond imaginations.Apparently the inter-rows were neglected long ago.For tapping they just cleared the tappers' path,that was all.

In 1971 we decided to replant it,So we called out for a reliable contractor.At that time rubber wood was in no demand.Many came the Boss himself selected one contractor and began cutting the trees in November 1971.

Unfortunately this contractors absconded after cutting down all the trees
for he feared he could not finish the contract on time.Lucky we did not over paid him.

We have difficulties finding a replacement so we decided to finish the job ourselves.So I took over.Initially I recruited another contractor to supply some chainsaw men to continue cutting the fallen trees into movable lengths.

Following I got some extra temporary workers recruited from nearby kampongs.We were fortunate because the estate was next to a Malay kampong.Most Javanese workers with one of them as headman.

So with them we roughly stacked the fallen wood onto the trunk.When the wood were drier we set fire to them just before we go home.Every day it was l like that.And I was with them from morning till evening.

As routine we re-stacked all the unburnt wood onto the huge trunk etc.and reburnt them,until all completely burnt off.By burning all the rubber wood like this we unnoticiably also destroyed all the wild rubber seedlings.

It took us nearly three months to completely cleared the field of 130 acs.,three months of hot sun and I was as dark as an all the Javanese workers.There was no doubt that the costs were high but we cannot help as we could not get another contractor to finish the job.

After this we plotted out the roads and also did lining for the replanting to Oil Palms.The roads were laid with laterites from our own hill.

We began planting in September 1972,with on set of the rainy seasons.Before we started planting we had a visitor,my Boss's friend,he came to see how we were planting.

I waited for him at the office and he came in his car.Thereafter I droved him to the replanting field.This guy on reaching the field rushed at the first palm planted by a worker earlier and began kicking it with his leather shoes.""See,no firm planting".

I was surprised at his action and said if I did not wait for him this would not have happened.I told him off because he was only a visitor.Anyway I told him if he wants my job he can have it.He kept quiet.

Later I learned that he was a Petrol Pump Owner (Mobil) in old Kelang Road.He was a pineapple planter.He later after this became Manager of Bidor Bahru Estate.To day he is a giant in the planting world.Like to know who? He is the shorty Lee Shin Cheng.Believe it or not.

We did an excellent job with our replanting and we completed it on time.The Boss was very pleased with it.

As for Mr.Lee I was told is still kicking lallang in his group of Estates.

Source here

Council To Spearhead ECER Development, Says PM

KUALA TERENGGANU, June 14 (Bernama) -- The East Coast Economic Region (ECER) Development Council will spearhead implementation of the ECER master plan and play the main role in determining the direction, policy and strategy for its development.

Prime Minister Datuk Seri Abdullah Ahmad Badawi, in stating this Saturday, said the council, set up under an Act of Parliament, would also generate and promote economic and social developments as well as private sector investments in the region.

"The setting up of the council, as an authority, is important to ensure that the ECER master plan is implemented in an efficient and orderly manner," he said at the launch of the council here Saturday.

"With this, the policies, planning and implementation by all parties can be streamlined in an organised and comprehensive way for the welfare of the local people," he added.

Abdullah said besides promoting economic activities in the ECER, the council would also study the impact of development programmes to ensure that socio-economic development was being carried out in tandem.

He also said that to ensure the success of the ECER, he has appointed members from the highest level for the council with himself taking on the responsibility of chairman.

Other members included Deputy Prime Minister Datuk Seri Najib Tun Razak, Terengganu Menteri Besar Datuk Ahmad Said, Pahang Menteri Besar Datuk Seri Adnan Yaakob, Johor Menteri Besar Datuk Abdul Ghani Othman and Kelantan Menteri Besar Datuk Nik Abdul Aziz Nik Mat, he said.

Abdullah said to strengthen the council, he has appointed Second Finance Minister Tan Sri Nor Mohamed Yakcop and Minister in the Prime Minister's Department Tan Sri Amirsham A. Aziz as representatives of the federal government.

Chief Secretary to the Government Tan Sri Mohd Sidek Hassan has also ben appointed to represent the civil service, he said.

The Prime Minister named Petronas' president and chief executive officer Tan Sri Mohd Hassan Marican and IOI Corp's executive chairman Tan Sri Lee Shin Cheng as representatives of the private sector.

Abdullah said at the management and operations level, the council will be led by Datuk Jebasingam Issace John as the chief executive officer.

"He was involved in drawing up the ECER master plan and is supported by a team which is capable of carrying out the council's functions effectively," he said.

Abdullah said the council has a heavy responsibility to ensure that the ECER objectives are achieved."

As the chairman, I will ensure that the council acts efficiently, effectively and impartially," he said.

On progress of the ECER so far, Abdullah said he was satisfied with the ECER secretariat for its efforts in developing several projects and programmes.Among them is the setting of Centres of Excellence at five universities in the region, namely Universiti Malaysia Terengganu, Universiti Darul Iman, Universiti Malaysia Pahang, Universiti Teknologi Mara and Universiti Malaysia Kelantan.

According to him, such centres are in line with the ECER objectives to encourage research and development, which can lead to related commercial industries coming up in the region.On the agriculture sector, Abdullah said several initiatives had started to be implemented.

Among them is the development of three agro valleys in Bachok-Setiu-Kuala Berang, Pekan-Rompin-Mersing and Kuantan-Maran areas, a herbal and biotech park in Gua Musang, Kelantan, and a fruit park in Lanchang, Pahang.

He said for the petrochemical sector, development of the Kertih Plastic Park had started and results were shown with an initial investment of RM50 million for factory and infrastructure.Abdullah said the government would continue to support the ECER by providing the optimum infrastructure.

He said the mid-term review of the Ninth Malaysia Plan would look into the allocations for the infrastructure development of the ECER as well as the other economic regions.-- BERNAMA

Source here

IOI Properties confident Sentosa Cove condos can sell

UALA LUMPUR: IOI Properties Bhd is confident that its biggest high-end development in Singapore’s Sentosa Cove will be a success despite soaring crude oil prices and a softening property market in the republic.

Executive director Datuk Lee Yeow Chor said the group had foreseen the market softening and construction costs rising when subsidiary IOI Properties (S) Pte Ltd and joint-venture partner Ho Bee Investment Ltd successfully tendered for a 5.3-acre 99-year leasehold land called Pinnacle Collection in Sentosa Cove in January for S$1.09bil (RM2.5bil).

The price is about 13.9% more than the reserved price of S$963mil.

“When we tendered for the land last December, the residential market in Singapore was consolidating. It’s good to have a correction as the market went up too fast, by 31%, last year,” Lee told StarBiz after shareholders approved the deal at an EGM yesterday.

Lee said what was more important was the land’s potential as it was the last piece of condominium land parcel in Sentosa Cove.

He said Sentosa Cove had three major attributes – a famous name; a seafront property that would attract many international high-net worth investors; and its location near the integrated resort-cum-casino development where the Genting group would be investing S$5.3bil.

“We believe the integrated resort will give Sentosa Cove a big boost when it (resort) is completed end-2009. We have timed our development (Pinnacle Collection) with the completion of the resort so that people can see the full potential of the place,” he added.

Lee said the group planned to build condominiums, priced about S$3,000 per sq ft.

Pinnacle Collection, to be launched next year, will have seven 18-storey blocks and a 20-storey luxurious condominium. It will have 280 apartments and penthouses of various layout and sizes.

“The average size (per unit) would be 2,500-3,200 sq ft. There will be private lift lobbies. It will cater to the international market,” Lee said, adding that besides Singapore, it would target investors from Indonesia, China, the Middle East and India.

It will have a total development cost of S$1.6bil and estimated gross development profits (before interest costs) of S$500mil.

To be completed in early 2012, it will be funded from sales proceeds, borrowings by joint-venture company Pinnacle (Sentosa) Ltd (IOI Properties and Ho Bee will have 65:35 ownership) and advances from shareholders. Sales will commence in mid-2009.

The Pinnacle Collection is one of two condominium parcels that flank the entrance of the marina leading to Sentosa Cove.

It is adjacent to the 3.6-acre leasehold Seaview Collection, which was successfully tendered by another IOI Properties subsidiary with Ho Bee in March 2007. Seaview Collection, a luxury condominium project comprising two eight-storey apartment blocks with 151 units, will be launched in the third quarter.

Source here

10-06-2008: IOI to delay project launches in Singapore

PUTRAJAYA: IOI Properties Bhd will wait for the next cycle to launch its property development projects in Singapore in view of the less-than-robust economic market, said its executive chairman Tan Sri Lee Shin Cheng.

However, he said construction work on the two projects — Seaview Collection and the Pinnacle Collection in Sentosa Cove — would go ahead as planned.

Speaking to reporters after the company’s EGM here yesterday, Lee said the time was not right to launch both the projects and “the next cycle will be higher than the previous cycle”.

IOI Property, through a joint venture with Ho Bee Investment Ltd, is developing the Pinnacle Collection, which comprises seven 18-storey blocks and one 20-storey block of luxurious condominiums, while Seaview is a luxury condominium development comprising two eight-storey apartment blocks.

The group has a total of 4,500 acres (1,821 hectares) of landbank in the Klang Valley and Johor. It also plans to develop 543 acres of land in Putrajaya into high-end bungalow lots and condominiums which would be launched next year.

On the issue of windfall tax which will affect IOI Corporation Bhd’s plantations division, Lee said the group was disagreeable to the tax as the industry was already paying cess to the Malaysian Palm Oil Board, in addition to levies imposed in Sabah and Sarawak, apart from their subsidising of cooking oil.

“There is no country in the world where planters are subsidising manufacturers,” he added.

Last week, the government had announced the removal of the cooking oil stabilising scheme as part of the subsidy restructuring scheme and replaced with windfall tax.

According to Lee, IOI was also finalising a US$100 million (RM325 million) investment as part of its expansion plan in Rotterdam, Holland. IOI already owns a palm oil refinery of 85,000-tonne capacity and would build a 300,000-tonne capacity plant to process margarine.

On its previous proposal to buy six plantation companies in Sarawak which would have cost RM439.9 million, IOI’s group executive director Datuk Lee Yeow Chor said the deal had fallen through due to technical issues.

“It is not about the price but title. Some pre-conditions cannot be satisfied,” he said, adding that it would be difficult to say if IOI would pursue the purchase of these plantations later. The six companies have a combined plantation landholding of 44,350ha, of which 30.4% or 13,500ha were planted with oil palm.

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Projects in Singapore set to further boost group image

VENTURING into Singapore's luxury residential property market is set to enhance IOI Properties Bhd's brand and reputation as a quality home developer in Malaysia and Singapore.

IOI Properties executive director Datuk Lee Yeow Chor is excited about the company's two projects in Sentosa Cove that would pave the way for more ventures across the causeway over the next two years.

The two projects will be undertaken with its Singapore joint-venture partner, Ho Bee Investment Ltd, which is involved in four other projects in Sentosa Cove.

The Seaview Collection condo in Sentosa Cove will comprise two eight-storey blocks of 125 residences.

“We are confident that the projects will do well as there are no more land for condominium projects in Sentosa Cove.

“The 5.3-acre land parcel that we successfully tendered for in January is the final piece of condominium land to be launched by Sentosa Cove Pte Ltd,” Lee said.

He added that the acquisition of the land has just been concluded and it would be the site for its second project, The Pinnacle Collection, which is one of the two condominium parcels that flank the entrance of the marina leading into Sentosa Cove.

Lee said the scheduled completion of the Genting group's integrated resort development on Sentosa Island next year would spawn a greater demand for more quality homes in Sentosa Cove.

“Sentosa Cove, a world-renowned exclusive residential development, is now about 50% completed while another 20% of the projects are now ongoing. It has attracted many high net worth buyers from around the world,” Lee said.

The Pinnacle Collection, comprising a 20-storey block of 250 luxury condominium units, will be launched by the end of next year.

The Pinnacle residences will have an average built-up of 2,000 sq ft. The building designs for the project are still being finalised.

Meanwhile, the company's first project in Sentosa Cove, the Seaview Collection, will comprise two eight-storey blocks of 125 residences on 3.6 acres.

Construction will start in the third quarter of this year and the project will be launched for sale by the end of the year.

Analysts look at IOI Properties' venture into Singapore positively.

A recent CIMB Research note said that as the company's profits were the largest compared with other Malaysian developers, IOI Properties had no choice but to seek new avenues for growth to see a significant impact on its bottom line.

“We view positively its choice of joint-venture partner as Ho Bee has carved a niche in high-end residential development projects on Sentosa Island.

“IOI Properties is one of the few Malaysian developers with the balance sheet to take on Singapore-scale projects,” it said.

CIMB Research said although the Singapore property market was highly competitive, “values are significantly higher than in Malaysia”.

“Assuming an average selling price of S$3,000 per sq ft, the sales value of the Seaview Collection condominiums alone is a mind-boggling RM2.4bil, which is equivalent to a medium-sized township that would easily take 10 to 15 years to complete.

“The break-even cost for the condominiums is estimated at S$1,900 per sq ft,” it said.

The margins for the Pinnacle project should also be good as the break-even cost is around S$2,400 per sq ft while the targeted selling price should be closer to S$3,500 per sq ft, the research house added.

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Oil palm companies to pay windfall tax from July 1

PETALING JAYA: The Government will impose windfall tax on oil palm companies starting July 1.

An analyst said under the Windfall Profit Levy Act 1998, a windfall levy would be imposed on crude palm oil (CPO) and crude palm kernel oil (CPKO) when the prices are in excess of the threshold of RM2,000 per tonne.

Under the proposed windfall tax framework, palm oil producers in peninsular Malaysia would be charged tax amounting to 15%, and 7.5% for Sabah and Sarawak.

At the same time, the Government is also abolishing the existing cooking oil cess from July 1.

However, the price of cooking oil will remain the same as it will now be subsidised by the windfall taxes.

The Government said plantation companies in Sabah and Sarawak were charged a lower windfall tax as they were already paying sales tax to their respective state governments.

OSK Research plantation analyst Alvin Tai said: ”The lower windfall tax is expected to be a positive move for plantation companies in Sabah and Sarawak. However, we expect the tax will have a slightly negative impact for companies in peninsular Malaysia.”

“The net impact of this move will be neutral but we remain overweight on this sector,” Tai said, adding that most plantation companies had exposure in the peninsula, Sabah and Sarawak.

A local plantation analyst said the imposition of the windfall tax would have minimal impact on the plantation industry.

“I don’t see it derailing profits, moving forward. Net impact on earnings would be minimal, given that the cess has been abolished at the same time.

“It (impact) also depends on the company. Big firms like IOI Corp Bhd which have diversified operations would be least affected while pure planters like IJM Plantations Bhd and Asiatic Development Bhd would be more affected,” the analyst said.

Under the new tax plan, companies in Sabah and Sarawak are expected to pay RM112.50 per tonne of CPO whereas their peninsular Malaysia counterparts would pay about RM225 for a tonne of CPO.

At the same time, all plantation companies would “save” about RM200 per tonne (at the current CPO price of about RM3,500 a tonne) with the abolishment of the cess tax.

This means companies in peninsular Malaysia would still have to fork out RM25 per tonne of CPO while those in Sabah and Sarawak would enjoy savings of RM87.50 per tonne.

Most companies contacted by StarBiz declined comment on the taxes, saying they needed time to study the tax framework before issuing any statements.

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Lee’s son appointed IOI Corp ED

KUALA LUMPUR: Lee Yeow Seng, son of Tan Sri Lee Shin Cheng, was appointed executive director of IOI Corporation Bhd yesterday.

Yeow Seng joined IOI group in 2002 as special assistant to Lee. Prior to that, he was with the London and Singapore offices of a leading international financial services group. He is involved in corporate affairs and general management within the IOI group.

He has a direct interest of 1.14 million shares and indirect 2.4 million shares in IOI Corp, and indirect 233.54 million shares in IOI Properties Bhd.

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