1. ROBERT KUOK
Flagship: Kuok Group/Kerry Group
Net worth: RM43.59bil
ROBERT Kuok is once again Malaysia’s richest man with a net worth of RM43.59bil, despite a fall in his wealth by RM6.32bil from the previous year.
The 95-year-old, who is touted as one of Malaysia’s most successful entrepreneurs who have grown their operations in China, controls businesses across Malaysia, Singapore and Hong Kong. His family members and relatives run the most important of the Kuok businesses.
Kuok has controlling stakes in three listed companies in Malaysia – PPB Group Bhd, MALAYSIAN BULK CARRIERS BHD (Maybulk) and Shangri-La Hotels (M) Bhd. PPB is a diversified company that is in plantations, food and also cinemas through Golden Screen Cinemas Sdn Bhd (GSC). Maybulk is a shipping line and Shangri-La Hotels is the No 1 hotel chain in the country. Across the causeway, he controls Wilmar International Ltd, which is the world’s largest palm oil-based edible oil trader that had a market cap of S$19.97bil as at year-end. In Hong Kong, Kuok’s wealth is primarily held via Kerry Group through a web of shareholding structures. Kerry Group has stakes in Shangri-La Asia, Kerry Properties and Kerry Logistics on the Hong Kong exchange. From the 1980s, Kerry Properties has developed large-scale properties mainly in China and has total assets of HK$167.9bil currently.
While the businesses in Malaysia are a big part of his wealth, the bulk comes from Hong Kong and Singapore.
As opposed to Singapore where the Wilmar stock closed flat, Shangri-La Asia and Kerry Properties on the Hong Kong bourse shed one-third and one-fifth in market values last year.
In terms of corporate activities, Maybulk completed its offer for sale of its entire 21.23% stake in Singapore-listed PACC Offshore Services Holdings Ltd (POSH) to its own shareholders in September last year. The deal raised RM251mil in cash to pay for new vessels and cut down debts. Before that in June, PPB, which owns GSC said it will spend RM300mil to expand and upgrade its cinema chain in the country. GSC has a 40% market share in Malaysia and the expansion will see it having a total of 348 screens in 36 locations.
Over at Singapore, Wilmar bought a 50% equity interest in Nauvu Investments Pte Ltd from Olam International Ltd for US$148mil. Subsequently Nauvu, which has interest in integrated palm oil, rubber and sugar assets in Africa, is a unit of Wilmar.
Wilmar also has a controlling 58.3% stake in Mumbai-based Shree Renuka Sugars Ltd after triggering a general offer early last year.
The company is India’s largest sugar manufacturer.
It appears that Kuok has plans to spin off some subsidiaries for public listing if recent media reports are anything to go by.
One is by Wilmar, which is said to be in the process of spinning off its Chinese subsidiary to list on the Shanghai Stock Exchange.
The other is Kuok’s Kerry Logistics, which reportedly is considering an initial public offering (IPO) of its Thai business that “could take place as soon as the first half of this year”. The Bangkok IPO could raise US$200mil to US$300mil, a report quoting sources said.
2. TAN SRI TEH HONG PIOW
Flagship: PUBLIC BANK BHD
Net worth: RM25.28bil
Tan Sri Teh Hong Piow of Public Bank Bhd has emerged as the country’s second richest backed by a 19.5% increase in the shares of the bank. The stock, a consistent performer on Bursa Malaysia with high dividend payouts year after year, closed at RM24.76 as of Dec 31 for a market cap of RM96.1bil – making it the second-most valuable banking stock after MALAYAN BANKING BHD.
The 89-year-old banker’s 23.4% stake in the bank, which he founded in 1966, is worth RM22.48bil.
Besides Public Bank, Teh also owns a 44.2% stake in insurance company LPI Capital Bhd, which was valued at RM6.27bil as at the end of last year.
These stakes collectively put his worth at RM25.3bil, up 17.3% or RM3.7bil from 2017’s wealth count.
Teh, who officially retired as non-executive chairman of the bank last year, can look back at the bank and feel fulfilled. While he remains on the board as chairman emeritus and adviser, 2019 marks a new era for Public Bank that is now professionally run.
How its management would ride through the more challenging economic climate ahead would be closely watched by all.
Not many can match the veteran banker’s achievement of steering the bank with unbroken profitability over five decades even during all the financial crises.
At 2.32 times price-to-book value, the bank is among the most expensive in the region.
The premium it commands is largely due to the high returns it has given to its shareholders on a consistent basis.
It is also one of the most efficient in the industry with a cost-to-income ratio of just 33%.
Public Bank is predominantly a retail bank, so any slowdown in domestic consumption would affect its loan growth, while stiff competition in the deposit space could lead to a larger-than-expected compression in overall margins, say analysts.
For the financial year ended Dec 31, 2018 (FY18), Public Bank posted a net profit of RM5.6bil.
It achieved a healthy loan growth of 4.2% in 2018 but for this year, the bank says it is expecting loan growth to come in at the lower end of its targeted 4%-5% range.
3. TAN SRI LEE SHIN CHENG
Flagship: IOI Group
Net worth: RM19.43bil
IOI Corp Bhd, the flagship company of Tan Sri Lee Shin Cheng, is an integrated plantation group with downstream operations in refinery and oleo-chemicals. This has helped it weather 2018’s commodity downcycle relatively better than its peers.
While its upstream business suffered in financial year 2018 due to the lower average selling price of crude palm oil, its downstream benefited from lower raw material prices, which lifted downstream’s earnings before interest and tax contribution to the group by more than one-third.
In 2018, crude palm oil prices had dropped to a three-year low of RM2,121 per tonne from a high of RM2,700 due to the current oversupply of palm oil in Malaysia and Indonesia.
The stock, which is seen as a sector bellwether, ended the year at RM4.45 for a market cap of RM27.96bil.
Lee and family derived the bulk of their fortune from IOI Corp, in which they own 49.8%.
The company is one of the largest oil palm planters with about 174,000ha of oil palm area. Of this, 90% is located in Malaysia.
IOI Corp, in turn, owns 31.7% of Singapore-listed Bumitama Agri Ltd, a producer of palm oil and palm kernel. This produce are sold to refineries in Indonesia.
The tycoon also has interest in property and construction through 64.9%-owned IOI PROPERTIES GROUP BHD, which has diversified into the Singapore and China markets.
The 80-year-old Lee runs the IOI group with his two sons. The older of the two, Datuk Lee Yeow Chor, helms the plantation business, while Lee Yeow Seng heads properties.
Last year, IOI Corp sold its 70% stake in IOI-Loders Croklaan for US$946mil (RM4bil), of which RM2bil has been utilised to pare down its debts. With this disposal, it is now in a much stronger financial position with a lower net debt of RM5.3bil, which translated to a decent net gearing of 29% as at end-December 2018. Going forward, it plans to further expand its upstream operations.
As for property, IOI Properties has a strategy to grow its presence in Singapore and China.
In Singapore, IOI Properties plans to fast-track its development on the land it bought in Marina Bay for S$2.57bil in late 2016.
This follows the imposition of a seven-year deadline on companies to complete projects which have been successfully tendered for.
In China, meanwhile, it has embarked on two mixed property developments and still has projects with a gross development value of 4.6 billion yuan to be launched.
Lee saw a slight dip in his worth to RM19.43bil, but it is enough to propel the tycoon to the number three spot in the rankings list.
4. TAN SRI LAU CHO KUN
Flagship: Hap Seng Group
Net worth: RM18.20bil
Sabah tycoon Tan Sri Lau Cho Kun has interests in several companies listed on Bursa Malaysia, led by Hap Seng Consolidated Bhd. Hap Seng Consolidated’s market cap stood at RM24.52bil based on its share price of RM9.85 as at December 2018.
Lau controls a 73.9% block in Hap Seng Consolidated through privately-held Gek Poh (Holdings) Sdn Bhd and Lei Shing Hong Investment Sdn Bhd (LSHI). He is the nephew of the late Tan Sri Lau Gek Poh, the maverick businessman who founded the group.
The group controls 53% of palm oil producer, Hap Seng Plantations Bhd, and is the second-largest shareholder in soap manufacturer PAOS HOLDINGS BHD with a 25% stake.
It is a significant Mercedes-Benz passenger car dealer, commanding a 40% market share. It is also involved in credit financing, quarry and building materials and the fertiliser business.
Despite the family’s controlling stake, professional managers have been brought in to run the show at the various companies.
Elsewhere, Lau is a substantial shareholder in BORNEO OIL BHD with a 5.1% stake.
Going by recent corporate exercises by the group, it would appear that Lau has a strategy to expand operations in the country.
In the last two years, Hap Seng has raised RM2.8bil from selling some of its key assets to Lau’s private vehicle LSHI. The proceeds went to partially pare down debts and fund the group’s operations in some of its key business divisions.
This include, among others, funding its money lending business and planned integrated mixed development project within the KL Metropolis development located along Jalan Dutamas, Kuala Lumpur.
The group had also acquired tile manufacturer Malaysian Mosaics Sdn Bhd from Gek Poh Holdings to complement its property business.
Last year, Bloomberg reported quoting sources that Lei Shing Hong Ltd, which runs Mercedes-Benz dealerships in Asia and Europe, was planning to relist in Hong Kong in a deal that could raise around US$800mil.
The company was taken private a decade ago in a deal valuing it at US$1.4bil then.
Lei Shing Hong runs Mercedes-Benz dealerships in mainland China, Taiwan, South Korea, the United Kingdom, Germany, Australia, Vietnam and Cambodia. It also sells Porsche vehicles in South Korea.
5. TAN SRI LIM KOK THAY
Flagship: Genting Group
Net worth RM16.56bil
The dice was not in favour of Tan Sri Lim Kok Thay and family, who saw a 30% or RM7.3bil drop in their wealth count last year. At RM16.56bil, Kok Thay was ranked fifth richest, down three notches from 2017’s ranking.
One was the unexpected hike in the casino tax by 10% to 35%, effective Jan 1, 2019. Secondly was uncertainty on the opening date of its outdoor theme park, which is the subject of Genting’s legal suit against Disney and Twenty-First Century Fox.
The new theme park based on the 20th Century Fox World design was supposed to boost the number of visitors to Genting Highlands resort for the next two years from June 2019.
The run of bad luck saw shares of Genting plunging 32% from RM8.70 to RM5.91, erasing RM9bil in value.
As for Genting Malaysia, the loss in value was larger at RM12.85bil or by 42%. The stock ended the year at RM2.77 from RM5.16.
The company closed FY18 in the red, its first loss-making one since 2000 on higher impairment losses of RM1.8bil.
Business-wise, the Genting group is still a formidable one with listed entities in Singapore, Hong Kong, the Philippines and US Nasdaq.
Under Kok Thay’s stewardship, the group transformed from a one-hill casino founded by the late Tan Sri Lim Goh Tong, to an international gaming and entertainment wonder.
The group derives consistent cashflow from its casino operations in Malaysia and Singapore, but is now building its cruise ship business and expanding its casino operations in Las Vegas.
It is also cash-rich, sitting on RM8.8bil of cash. This puts it in a strong financial position to tender for new gaming jurisdictions in countries like Japan and Macau.
Besides gaming, the Genting group has interest in plantations via listed Genting Plantations Bhd and exposure to the power and oil and gas sectors.
From this year, Kok Thay’s son Lim Keong Hui has been appointed deputy CEO of Genting, Genting Malaysia, and Genting Plantations - marking the third generation in the empire. Observers do not discount more executive roles given to the 34-year old Keong Hui as he is seen being groomed as the third generation successor of the Lim family.
However, an ongoing family feud is casting a cloud over the Genting empire.
The dispute over a family trust that Goh Tong had created, one of several created as corporate vehicles for the family inheritance, has spawned other legal battles.