UBG looks at new deals

  • Business
  • Thursday, 18 Sep 2008

Second phase of transformation involves energy, water, and oil and gas

PETALING JAYA: UBG Bhd will now look at new deals involving the energy, water, and oil and gas businesses after completing the takeover of Putrajaya Perdana Bhd and Loh & Loh Corp Bhd.

“The completion of the general offers for Putrajaya Perdana and Loh & Loh marks the end of phase one of UBG’s ambition to evolve and transform into a Pan-Regional MESEA (Middle East-South-East Asia) company,’’ UBG deputy chairman Syed Ahmad Alwee Alsree said in an interview.

“We are in the process of implementing phase two and this relates to our energy, water and oil and gas businesses. On the strategic front, we are expanding our core businesses through acquisitions, partnerships and organic growth.’’

With those two public-listed companies under its wing, Syed Ahmad said a multi-thrust strategy was being employed for the long-term growth of UBG’s business assets, in which the company expected the energy business emerging as a larger contributor to its bottomline.

Syed Ahmad Alwee Alsree

“Whilst top line growth remains the primary focus, equal attention is focused on managing operational risks and controlling costs to enhance our business margins,’’ he said.

UBG remained confident it could at least double its order book to RM3bil in the near term from over RM1.5bil now from the various government economic development initiatives, especially in Sarawak and the Middle East.

The completion of the acquisition of Putrajaya Perdana and Loh & Loh would see the company establish a new board of directors and a management lineup, and that could take place by the end of the month.

The group is also said to be looking at oil and gas opportunities in Malaysia and the region and is also assessing potential acquisitions of power plants.

Syed Ahmad said offices had been set up in the Middle East and Sarawak and the company had been busy in South-East Asia and the Middle East for more jobs and businesses.

He, however, said growth via acquisitions would “remain a primary staple for UBG currently as we build up our core-sector competencies.”

Acknowledging that economic conditions were challenging, Syed Ahmad said the company needed adequate liquid financial resources to invest and harvest long-term cash flows.

“The concession, construction and infrastructure and energy, water and oil and gas businesses are important for us as we have sufficient industry skills, partnerships and processes to comfortably operate in an environment where we can manage risks better than competitors to achieve premium returns,’’ he said.

“This business blend, coupled with a strong balance sheet, solid cash position, financial acumen and professional team, gives us confidence that we can operate in this challenging market.”

Syed Ahmad said having a diverse base of institutional shareholders, both local and foreign, gave the company a lot of benefit and dialogue with them had provided a forum for the company to grow its business network.

He said UBG was constantly seeking new institutional shareholders who could add value to the company.

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