Issue 33

Malaysia’s Sime Darby buys NZ-based Gough Group for $136m

Malaysian trading and logistics conglomerate Sime Darby Bhd on Tuesday announced that it is acquiring New Zealand’s Gough Group Ltd for NZ$211 million ($136.2 million). 

The deal is Sime Darby’s largest since a pure-play restructuring exercise in 2017. The conglomerate is owned by Malaysia’s state-linked investment firm Permodalan Nasional Bhd (PNB). The deal was conducted through its indirect wholly-owned unit Sime Darby (NZ) Holdings. 

Gough Group has the Caterpillar dealership with service territory in New Zealand and interests in the transport and materials handling business in New Zealand and Australia. Its revenue has grown more than 18 per cent in 2018 to NZ$540 million from the previous year, driven by improvements in sales for both its Caterpillar and transport and material handling business. 

“The Gough Group transaction…provides a rare opportunity for us to enhance our relationship with Caterpillar, and gain exposure to the construction and forestry sectors in New Zealand, further reinforcing Sime Darby Industrial’s footprint in the Asia Pacific region,” Sime Darby group CEO Jeffri Salim Davidson said. 

The Gough Group’s transport and material handling portfolio will also complement Sime Darby Motors’ commercial truck business in New Zealand, he added. In Australia, Sime Darby is represented by Hastings Deering, one of Caterpillar’s leading dealers, as well as through Sime Darby Motors’ dealerships for BMW, Volvo, Ferrari and Rolls Royce in Brisbane and Porsche in Sydney. In New Zealand, Sime Darby Motors operates under the Continental Cars and City Nissan dealerships in Auckland, representing brands such as BMW, Porsche, Volkswagen, Audi, Ferrari and Nissan. Sime Darby’s automotive arm also has a commercial transport arm representing brands such as Volvo, Hino, Mack and UD Trucks. 

The deal will be fully funded by bank borrowings, on a cash-free and debt-free basis and is subject to New Zealand’s Overseas Investment Office approval. It is expected to be completed by September 30, 2019.


From – Deal Street Asia


Malaysia’s AllSome Fulfillment secures $1.94m led by East Ventures

AllSome Fulfillment, a startup focused on cross-border e-commerce fulfilment, announced on Thursday that it has secured $1.94 million in seed funding led by East Ventures. 

AllSome provides services including sourcing from international suppliers, offshore quality assurance, secured storage, pick & pack, door-to-door delivery and parcel tracking. It also helps end-users track their deliveries from multiple websites in one place. 

The fresh funding will support the company’s expansion to other countries across Southeast Asia, including Indonesia, according to a statement. According to data by global consulting firm Accenture, cross-border B2C e-commerce market in the Asia Pacific has the potential to reach more than $476 million by 2020, covering 31 per cent of the total B2C e-commerce market. 

AllSome Fulfillment, which was established in 2018 by Malaysian Ng Yi Ying and Chinese national Liu Yi Shu, started out as an online seller. “As a former online seller ourselves, we understand how fulfillment services are always expensive. 

AllSome Fulfillment is built essentially to make it affordable for every seller to use e-commerce fulfillment everywhere they need. AllSome Fulfillment has made significant efforts in building up a wide fulfillment network to service online sellers throughout their supply chain,” AllSome Fulfillment co-founder and CTO Ng Yi Ying said in a statement. 

AllSome said it expects to reduce cross-border fulfilment and logistics cost by at least 40 per cent in an effort to help online sellers book more profit. The startup has established a network of 250 virtual warehouses in China and Malaysia, serving 50 clients across Southeast Asia. 

The company handles 120,000 parcels deliveries on a daily basis. East Ventures is one of the most active VCs in Indonesia, with portfolio companies such as Ruangguru, Fore Coffee, Warung Pintar, IDN Media, Shopback, and many more.

From – Deal Street Asia

Thai lenders TMB, Thanachart approve $4.6b merger deal

Thailand’s TMB Bank, Thanachart Capital (TCAP) and Scotia Netherlands Holding (BNS) have approved the $4.6-billion merger of TMB Bank and Thanachart Bank (TBANK). 

Following the merger, TBANK will have total assets of about 1.9 trillion baht and approximately 10 million retail customers. It will become the sixth largest lender in Thailand. TMB Bank said earlier this year that a non-binding agreement was sealed that would see the merger valued at as much as 140 billion baht ($4.6 billion). 

In a stock exchange filing submitted on Friday, TMB said it has agreed to purchase more than 6 billion shares of TBANK, equivalent to a 99.96 per cent interest from TCAP and BNS. 

In addition, it will also offer to purchase the remaining 2.4 million shares (or 0.04 per cent) from all other minority shareholders of TBANK. 

Upon closing the transaction, TCAP will itself hold up to 23.3 per cent, and acting on account of TBANK minority shareholders to hold 0.04 per cent, of the new entity after TMB Bank issues new shares to facilitate the merger, while BNS will hold up to 6.4 per cent. 

As part of the agreement, the entire shares of TBANK’s subsidiary TBROKE and 75 per cent of TFUND will also be transferred to TMB Bank. 

The purchase price of TBANK shares is defined as the book value of its shares plus profits from the restructuring and premium in an amount of 9.245 billion baht, and deducting the book values of TBROKE and TFUND. The price will be settled by cash or a cash equivalent, TMB Bank said. . 

The purchase price “is reasonable because the merger would significantly enhance the scale of the merged bank’s business, making it one of the leading banking franchises in Thailand,” it added.

From – Deal Street Asia

Japanese pharmacy giant Matsukiyo in talks to merge with rival Cocokara

Japanese drugstore giant MatsumotoKiyoshi Holdings said it was starting talks to merge with rival Cocokara Fine Inc, possibly creating the country’s biggest chain of discount pharmacies with nearly $10 billion in annual sales. 

Cocokara Fine shares briefly jumped 9% on Wednesday after the company said it had decided to negotiate a potential merger with the bigger MatsumotoKiyoshi. 

It had considered a tie-up with another drugstore chain, Sugi Holdings, but chose an offer from MatsumotoKiyoshi instead, it said in a statement. The companies said they could not comment on details of negotiations, such as possible terms and deadlines for the talks. 

Known as “Matsukiyo”, MatsumotoKiyoshi started as a mom-and-pop pharmacy in the 1930s and has grown rapidly through aggressive store openings and acquisitions. It was a pioneer in drugstores’ sales of discount cosmetics, allowing consumers to more casually sample products. It and other major drugstores have also expanded into snacks, soft drinks, and liquor, dealing a blow to the country’s convenience stores and supermarkets. 

But drugstores, like the rest of Japan’s retail industry, are now grappling with a dwindling workforce and tough price competition. “It will not be easy to overcome business challenges on our own, and therefore it is appropriate for us to merge,” Cocokara said in a statement. 

“By combining with MatsumotoKiyoshi Holdings … there is a chance of creating major synergies such as improving work efficiency and developing private brand products.” A merged company will earn over 1 trillion yen ($9.4 billion) in annual sales, topping sector leaders Welcia Holdings and Tsuruha Holdings. 

Shares in Cocokara Fine surged to their highest since November 2018, and were up 1.3% in mid-afternoon trade, while MatsumotoKiyoshi shares fell 2%. Shares in Sugi, which said it would look for other potential partners, rose around 2%.

From – Deal Street Asia

Anbang puts $2.4b Japanese property portfolio on block, Blackstone seen bidding

China’s troubled Anbang Insurance Group has put its $2.4 billion property portfolio in Japan up for sale and previous owner Blackstone Group is bidding, two people familiar with the company’s plans said. 

The insurer is offering its entire portfolio of mainly residential buildings in Tokyo and other big cities after it failed to sell some of the assets last year, the sources said. “The sale process has just started. Anbang is planning to sell the entire portfolio it bought from Blackstone,” said one of the sources who declined to be identified because they were not authorized to speak publicly about the company’s plans. 

Representatives for Anbang and Blackstone declined to comment when contacted by Reuters. A price has not been set as the sale is still in its early stages, they said. 

Anbang paid Blackstone about 260 billion yen ($2.4 billion) for the portfolio in 2017, then Japan’s biggest property deal since the global financial crisis. The Chinese government took control of Anbang in February last year, part of a campaign to reduce financial risk. 

Anbang’s former chairman, Wu Xiaohui, was later sentenced to 18 years in prison for fraud and embezzlement. Since then Beijing has accelerated asset disposals at the insurance group, which was among the most aggressive Chinese buyers of foreign assets. Anbang tried to sell a portion of the Japanese portfolio last year, but failed to attract buyers because the assets were less attractive due to age and location, the sources said. 

They said Blackstone was among the bidders for the entire portfolio largely made up of apartment buildings catering to middle class clients in Tokyo, Nagoya and other large cities. 

Residential assets are attractive to Blackstone because they generate stable cash flow regardless of the economic cycle, unlike commercial office buildings, the sources said.

From – Deal Street Asia
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