KUALA LUMPUR: Ekuiti Nasional Bhd (Ekuinas) is looking at divesting from three of its investee companies towards the end of this year to realise profits.
According to chief executive officer Syed Yasir Arafat Syed Abd Kadir, the government-owned private equity (PE) firm, however, will likely see the planned divestment exercise to be fully completed by early 2020.
“This year alone, we are looking at potentially three more divestments, which could spill over to early next year, ” he told a press conference at the Malaysian Private Equity Forum 2019.
So far, this year, Ekuinas had divested its entire 60% in third-party claims administrator service providers MediExpress Group and PMCare Sdn Bhd to Sumitomo Corp for an undisclosed sum; and its entire equity interest, together with its minority partners in APIIT Lanka Pvt Ltd for RM41mil to BG Investments Pte Ltd.
Separately, Syed Yasir Arafat clarified that Ekuinas had no plan to exit its 42.3%-owned oil and gas support services company Icon Offshore Bhd in the near term.
“Our plan is to ensure that the recapitalisation plan happens as soon as possible, so that we can think about the next stage of growth for Icon Offshore, ” he said.
Meanwhile, Syed Yasir Arafat acknowledged the number of deals for Ekuinas had slowed this year, and the trend would remain subdued into 2020 due to the valuation gap between buyers and the sellers
“For 2019, a lot of people are taking a very cautious view in light of the expanding multiples, especially in private equity in general.
“There were a lot of deals that happened in the early part of this year, which we deemed expensive. Unfortunately, that has set the tone for some of the deals we are working on, ” he added.
On its planned investment in subsidiaries of government-linked companies (GLCs), Syed Yasir Arafat said: “We’re looking at the non-core subsidiaries of some of the GLCs in Malaysia... we have identified certain sectors within the GLCs that we could be interested in but we don’t want to make any speculation or statement.”
He added: “We are not in control of the timeline in terms of the readiness of the various GLCs to kickstart their divestment programmes.”
Syed Yasir Arafat, however, declined to elaborate on the sector types of the GLC business that Ekuinas was eyeing. Ekuinas in May revealed that it had engaged in high-level talks to acquire certain subsidiaries of GLCs that would embark on privatisation activity.
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