TANJONG plc has been consistently ranked among the best-managed companies with the highest corporate governance standards in Asia by various investment research houses and fund managers.
With its high dividend yield, Tanjong is also a fairly popular pick of investors.
Analysts said the domestic-oriented and resilient nature of its core businesses – power and gaming – had made Tanjong a top pick in times of uncertainty arising from the external economic environment. Its numbers forecast totalisators (NFO) business, as with all NFOs, are cash-generating businesses that do not need capital expenditure to expand while its subsidiary Powertek Bhd is among the most cash-rich independent power producers in Malaysia.
Tanjong, via its subsidiary Tanjong Energy Sdn Bhd, is currently in the process of taking Powertek private, which is expected to add another 9% to Tanjong’s bottom line.
Back in 1990, however, Tanjong was totally different. Mining was the principal activity of the company, then known as Tanjong Tin Dredging plc, but with its failure to have its mining lease renewed, the oldest tin company in the country was left with no operating activity and a bleak future.
Trading in its shares on the London Stock Exchange (LSE) and the KLSE was suspended on March 9 and March 10, 1989, respectively.
A shareholder then would have been far from happy.
On Oct 23, 1991, Tanjong received a new lease of life following the acquisition of Pan Malaysian Pools Sdn Bhd (PMP). With this classic case of “backdoor” listing by PMP, a gaming operator with a bright future, Tanjong made its debut in a viable business of managing and operating NFOs.
In the same year, the company made a five-for-one rights issue of 15p shares at RM2 per share.
On Dec 24, 1991, trading in Tanjong shares resumed on the KLSE, opening at RM6.15 before closing at RM6.10.
Subsequently, Tanjong exercised a share split whereby each 15p share became two shares of 7.5p. The share split was completed on April 1, 1993, and the new shares began trading on May 21, 1993.
Thus, if one had held one lot of Tanjong shares since Jan 1, 1990, or in this case since March 1989, and had chosen to exercise the rights issue, one would have ended up with 12 lots and made a net profit of RM116,480 – enough to buy nice cozy apartment.