Chua Ma Yu buys 14% of Star Cruises

  • Business
  • Saturday, 14 Jul 2007

PETALING JAYA: CMY Capital (L) Ltd will pay RM1.168bil cash to acquire a 14.02% stake in Star Cruises Ltd from Resorts World Bhd. 

In a Bursa filing yesterday, Resorts World said its wholly owned subsidiary, Resorts World Ltd (RWL), had accepted the offer from Datuk Chua Ma Yu-owned CMY to purchase 1.01 billion shares of 10 HK cents each in Star Cruises. 

As of March 31, Resorts World held 33.91% equity interest in Star Cruises. 

Resorts World said it was reducing its stake in Star Cruises to mitigate its exposure to the volatile earnings of the Star Cruises group. 

Up to March 2007, Star Cruises' unaudited results showed a net loss of US$79.39mil on revenue of US$564.88mil. 

“Upon completion of the proposed disposal, Star Cruises will not be regarded as an associate company of Resorts World. 

“Resorts World will no longer equity account for Star Cruises' financial results going forward,” it said, adding that the disposal was subject to approval from the authorities. 

It also said the net proceeds from the disposal would be used for working capital or held in interest bearing bank deposits and/or money market financial instruments pending further evaluation of Resorts World group's strategic options and opportunities. 

Resorts World said the deal was expected to be completed in three weeks. 

As of Dec 31, 2006, Resorts World group's carrying value of Star Cruises shares under the proposed disposal is over RM856mil. 

Based on Resorts World's audited consolidated financial statement as at Dec 31, 2006, the proposed disposal is expected to result in a net gain on disposal of RM309.7mil. That is equivalent to consolidated earnings per share of 5.67 sen. 

Resorts World also said Chua had provided a performance guarantee with respect to CMY's obligations in the proposed disposal. As at July 9, CMY is principally an investment holding company. 

Star Cruises' principal activity is investment holding, while its subsidiaries are engaged in cruise and cruise-related operations. The company's vessels call at over 200 destinations in Asia, Caribbean, Bermuda and the Mediterranean. 

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