In a filing with Bursa Malaysia yesterday, Sime Darby said SDE had on Feb 5 received a notice from the Dubai International Arbitration Centre (DIAC) that EMAS had submitted a request for arbitration against SDE which was filed on Jan 24, 2016. The amount that EMAS is seeking from the arbitration proceedings is AED41.04mil (about RM46.37mil).
KUALA LUMPUR: Sime Darby Bhd
has categorically denied a news report that about a possible merger between its motor unit with that of UMMW Holdings.
“Sime Darby Bhd has announced its plans to create three independent listed companies on Bursa Malaysia and this is our main focus currently,” it said in a statement on Monday.
It was referring to The Edge report titled "Sime Darby Motors-UMW Holdings merger on the table" published on March 11 2017 about the two companies’ major shareholder Permodalan Nasional Bhd (PNB) looking into the possibility of such a merger.
“This report is incorrect. It is untrue that a merger of the automotive businesses of the two companies is on the cards,” it said.
“Sime Darby Motors is the second largest BMW dealer in the world and a major player in the automotive industry in the Asia Pacific region.
“Corporate exercises undertaken by Sime Darby Motors take into account the best interest of all our stakeholders, including shareholders and principals,” said Sime Darby.
Meanwhile, CIMB Equities Research believes there are potential hurdles if PNB decides to merge the motor units of UMW Holdings and Sime Darby Motors.
PNB is currently the major shareholder in both companies. The merger would create a major automotive company in PNB’s stable.
The research house pointed out on Monday that the hurdles are that UMW must obtain the approval of its key partners, including principal Toyota Motor Corp Japan (TMC, which owns 39% of UMW Toyota Motor Sdn Bhd).
CIMB Research said for example, TMC may not be agreeable to its dealers selling competing brands. If the merger results in the entities losing some of its dealerships, the proposal may be value-destructive for shareholders.
UMW’s management has not indicated intention for merger. The company is in the midst of restructuring its core operation following the decision to exit the oil and gas business, the research house said.
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