THE need to reduce duplication of resources, better manage its marketing efforts and gain a greater market share of contracts were factors that drove Kumpulan Darul Ehsan Bhd (KDEB) to reorganise its business units and focus on its strengths.
Like many companies, KDEB was affected by the 1997 economic and financial crisis and two of its listed vehicles - SAP Holdings Bhd and Brisdale Holdings Bhd - got into trouble.
Since the 1997 Asian financial crisis, the property sector has been badly affected and in 2000, we ventured into the water business. This (business segment) is maturing now,'' KDEB president Datuk Zabir Bajuri said.
Prior to the reorganisation, there were several companies doing property development, too much wasteful duplication and there were no concerted efforts to tap opportunities,'' he added.
Now the group has been streamlined into five core activities - property development; infrastructure and utilities; information and communications technology (ICT); education; and hospitality and recreation.
All property-related activities come under Kumpulan Hartanah Selangor Bhd (KHSB) while infrastructure and utilities under Kumpulan Perangsang Selangor Bhd (KPS). The two will be listed on the KLSE on July 22.
Under its education business, KDEB has Universiti Industri Malaysia (Unisel), Institut Pendidikan Selangor (Inpens) and Kolej Islam Darul Ehsan Bhd (Kisdar) in Bangi.
As for ICT, KDEB is involved in the smart school project, systems application and integration, telehealth (online medical) and is an application service provider.
Its hotel division owns the 154-room Quality Hotel Shah Alam, the 250-room Quality Hotel City Centre and 302-room Brisdale Hotel in Kuala Lumpur. The division also runs the 18-hole Perangsang Templer Golf Glub, Kelab Darul Ehsan in Taman Tun Abdul Razak, and the OUG Club in Taman Yarl in Kuala Lumpur.
We have diverse business interests and there was a need for management specialisation to ensure continued growth in the future.
Rationalisation has helped (us to) focus on areas of expertise and core competencies, Zabir said, adding that it had also enabled the group to unlock the value of its assets.
Prior to the reorganisation, KDEB owned 82% of KPS. But now it has 69% and by merely diluting the 13%, KDEB has gained over RM220mil.
Business aside, since KDEB gets projects from the state, it also wants to be a good corporate citizen by giving back to society.
As a business entity we have a role to play not only to our shareholders by giving maximum returns but also our customers - those who buy properties from us.
As a concerned corporate citizen, we have to contribute towards eliminating poverty in the state. We make provisions to build or repair houses for the poor. Last year we contributed 280 houses for the poor in several districts. Each house cost us about RM17,000,'' Zabir said.
KDEB also helps bridge the digital divide by setting up ICT centres - costing about RM70,000 each - complete with personal computers and accessories.
Currently, it is promoting the use of English language by working with various higher learning institutions and the Selangor Education Department to train primary school teachers.
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