Top 40 richest in Malaysia: 31-35

31 TAN SRI TIONG HIEW KING
Flagship: Rimbunan Hijau Group
Net worth: RM1.46bil

THE 81-year-old Tiong, the founder and chairman of the Rimbunan Hijau Group, did not undertake any notable corporate deals last year.

This was probably in tandem with the sluggish timber sector. Both Jaya Tiasa Holdings Bhd and Subur Tiasa Holdings Bhd - two listed companies under the Rimbunan Hijau group - reported a double-digit drop in log production in 2016.

Jaya Tiasa owns a large forest concession area of some 713,200ha in Sarawak. However, timber-related activities may be facing a tougher outlook going forward due to the requirement to comply with strict rules related to timber or forest certification and sustainable forest management.

Both companies responded by intensifying the adoption of the revised logging procedures to prepare for the certification under the Malaysian Timber Certification Scheme.

Rimbunan Hijau’s palm oil business under Rimbunan Sawit Bhd was also affected by the sluggish crude palm oil price. This was also the case of RH Petrogas, the oil and gas business under the group, which is still suffering from the prolonged depression of crude oil prices.

Rimbunan Hijau also controls Media Chinese International Ltd, which has in its stable five newspapers in 13 editions and three free newspapers. The publications are in Malaysia, Hong Kong and Canada. Among the Malaysian newspapers under its stable are Sin Chew Jit Poh, Nanyang Siang Pau, China Press and Guang Ming Daily.

Tiong, who is from Sibu, Sarawak, has a strong affinity towards Chinese culture and traditions.

The Rimbunan Hijau group provides facilities whereby members of the public in Sibu also can access free Internet connection, following the installation of 32 Howddy wireless hotspot zones.

32 Datuk Leong Kok Wah
Flagship: Eco World Development Group Bhd/Salcon Bhd
Net worth: RM1.392bil

The rise of Eco World Development Group Bhd has steered the affable Leong, who is better known as Eddy Leong in corporate circles, as among the top-40 richest businessmen in the country.

The year 2016 saw Leong indirectly increasing his stake in property development company Eco World. A private company where he is a shareholder - Sinarmas Harta Sdn Bhd - paid RM149mil to take up a private placement exercise in the developer.

The faith in Eco World has paid off well for its investors, Leong included.

Eco World’s brand has landed the developer prominent developments such as the Bukit Bintang City Centre project. It has also gained traction with strong partners such as the Employees Provident Fund (EPF).

The two are developing a mixed project on 890ha in Kuala Selangor that has an RM15bil gross development value.

Eco World and the EPF are also undertaking maiden township developments in Penang.

Besides property development, Leong also holds about a 10.5% stake in water-treatment company, Salcon Bhd,

It has won new water-treatment contracts in Terengganu and Johor totalling RM232.2mil.

The contracts are to build a 120 million-litres-per-day water-treatment plant in Kuala Terengganu and upgrade the Sungai Lebam water-treatment plant and distribution system in Johor.

These contracts will beef up Salcon’s order book by about 40%.

Going forward, Leong is expected to further bask in the corporate limelight as Eco World International, an associate of Eco World, goes for an initial public offering in the first quarter of this year.

33 GOH SIANG & family
Flagship: Karex Bhd
Net worth: RM1.362bil

The Goh family made their fortune from the production of condoms.

Last year, the largest condom manufacturer in the world providing about 15% of the world’s supply, signed an asset purchase agreement with TheyFit to acquire the company’s intellectual property rights for US$1.3mil (RM5.5mil). The purchase comes with approvals from the Food and Drug Administration of the United States, which allows Karex to increase its market share in the US.

Karex, which is majority-owned by Goh Siang and his family, has thrived under the original equipment manufacturer (OEM) model.

However, it has been recently hit by rising production costs that caused margins to erode in 2016.

The purchase of intellectual property rights enhances its venture into its own-brand manufacturing business model (OBM) and is expected to enhance Karex’s earnings base.

Its ONE brand has gained momentum in Malaysia and Singapore, and is expanding to Europe and Asia Pacific. Despite the gradual transition into OBM, Karex’s business model is still dominated by OEM works that contribute more than 90% of its top-line.

While more mergers and acquisitions could be on the cards, the management has indicated that they are comfortable after several major acquisitions over the past few months and will now focus on consolidating the multiple brands and working to achieve the projected synergies.

Last year also saw the entrance of Karex into Forbes Asia’s “Best Under A Billion” list.

34 TAN SRI ONG LEONG HUAT
Flagships: OSK Holdings Bhd, OSK Ventures International Bhd
Net worth: RM1.22bil

AT 71, Tan Sri Ong Leong Huat saw his estimated net wealth shrink by almost 20% to RM1.22bil from RM1.51bil in 2015.

Last year, the most notable corporate deal that Ong undertook was to launch a second attempt to take over PJ Development Holdings Bhd, after having failed in 2015.

The first attempt at taking over PJ Development fell short of the 90% requirement for a compulsory acquisition. OSK had offered RM1.56 per share and 60 sen per warrant at the time.

The second offer valued the shares and warrants lower at RM1.50 per share and 50 sen per warrant. This offer saw the deadline being extended twice after the original deadline of Oct 6 lapsed.

It was finally completed late last year, paving the way for the full merger between OSK Property and PJ Development.

The rationale behind the takeover of PJ Development was for OSK to have greater autonomy in re-organising the corporate structure, rationalising the business activities, and streamlining the operations of the enlarged group of companies in order to achieve greater economies of scale and create cost-synergetic benefits.

OSK said the delisting of PJ Development also helped to eliminate the administrative efforts and costs in maintaining the listing status of the company to divert more resources to its core business.

The privatisation of PJ Development and OSK Property by OSK has seen the latter’s revenue shooting up more than three times to RM929mil in the year-to-date nine-month period until Sept 30, compared with RM302.2mil in the preceding year.

OSK’s normalised pre-tax profit, which excludes the one-off gains of RM363.16mil in the nine months of 2015, rose by 48% to RM204.01mil for the period.

The enlarged group following the privatisation of PJ Development now houses five key business segments, namely, property, construction, industries, hospitality, and financial services and investment holding segments.

At RM1.41, OSK’s shares are now hovering at their three-year low, which explains why Ong’s estimated wealth dropped as well on a marked-to-market basis.

The banker and property tycoon is the dominant shareholder in listed OSK Holdings (58.2%) and OSK Ventures International (62.1%), which are his flagship companies.

After the share-swap deal with RHB Bank Bhd some years ago, Ong also owns a 10.1% stake in RHB Bank indirectly through OSK today.

Ong is also a non-independent, non-executive director at RHB Bank, a position which he has held since 2012.

He also has a 16.2% stake in public-listed computer solutions company Willowglen MSC Bhd.

35 TAN SRI LEONG HOY KUM
Flagship: Mah Sing Group Bhd
Net worth: RM1.22bil

The “Year of the Rooster” heralds the pinnacle of Mah Sing Group Bhd’s transformation that started three years ago.

The 60-year-old group managing director and chief executive officer of Mah Sing, Tan Sri Leong Hoy Kum, is poised to allow his children to play a bigger role in the management of the company.

A seasoned hand in the property development segment, Leong is rather optimistic about this year.

He took Mah Sing from being a pure manufacturer of plastic products to getting listed and now a notable property player.

Leong, who gave up a chance to further his education overseas in the 1980s to specialise in the manufacturing of plastic products, took a liking for property in the 1990s.

He went through a property crash in 1998 and learnt to read the market well. In the last two years, he has adopted a cautious strategy, not launching any new projects in new areas.

Mah Sing had initially set a sales target of RM2.3bil last year. However, it scaled the target down to RM1.8bil on the back of a slow property market.

It only launched new phases in existing projects that were up and running. And the last time Mah Sing launched a brand new project in a new location was back in 2015.

Leong’s strategy to be cautious has paid off, as Mah Sing now enjoys a strong balance sheet with negligible gearing.

A realist, Leong’s main goal for 2017 is to maintain or improve on Mah Sing’s sales last year.

Leong is now focused on steering Mah Sing to build more affordable properties to cater to consumer demand, as well as to better withstand the property slowdown.

The group has 2,473 acres of remaining undeveloped land, which has a combined remaining gross development value and unbilled sales of RM30.9bil, which can support the company’s revenue growth for eight to nine years.