Business

Thursday November 12, 2009

Razeek tipped to take over as MRCB MD


PETALING JAYA: Malaysian Resources Corp Bhd chief operating officer (COO) Mohamed Razeek Hussain is likely to succeed Shahril Ridza Ridzuan as managing director when the latter assumes the position of chief investment officer of the Employees Provident Fund.

According to sources, the MRCB board will make a decision on the matter soon.

Mohamed Razeek Hussain

“The group already has a succession plan in place. Razeek, as COO, is a highly likely candidate to take over the top position in MRCB,” said a source.

It was reported in StarBiz yesterday that MRCB executive director Datuk Ahmad Zaki Zahid was speculated to take over the helm of the property and construction group.

However, sources said that while he would be given more responsibilities in MRCB and may be groomed to lead the group in future, the plan as it stood now was to pass the baton to Razeek.

Razeek began his career in an engineering consultant firm in London in the early 1980s and returned to join an engineering consulting firm in Kuala Lumpur.

He has over 20 years of experience in property development projects, having worked for Sime UEP Bhd, Land & General group and E&O Property Development Bhd.

In recent weeks, MRCB has been in the news. It recently subscribed to a 70% stake in Yes 88 Pty Ltd for A$6.6mil (RM20mil). Yes 88 owns a 1.24-acre site 15km from Melbourne City Centre, Australia.

The planned development is for two four-storey residential properties with a total gross development value of A$54.8mil (RM170mil).

RHB Research believes the execution risk of the project is manageable, given that the project is the brainchild of MRCB’s partners in the project.

The remaining 30% in Yes 88 is held by Malaysian entrepreneurs Choong Kai Wai, Tam Cheok Wing and Chang Chai Kin.

Meanwhile, the RM20mil investment will increase MRCB’s net debt and gearing of RM714.2mil and 1.1 times as at June 30, 2009 to RM734.2mil and 1.13 times.

RHB Research is mildly positive on this latest venture.

“Assuming a profit before tax (PBT) margin of 20%, MRCB’s share of PBT from the venture is projected at RM23.8mil over the project period,” it said.

RHB Research maintained its forecasts that MRCB will register property turnover and operating earnings of about RM230mil and RM42mil per annum in its financial years (FY) 2010 and 2011.

This would be underpinned by recurring sales at its existing projects, particularly KL Sentral, as well as contributions from new property ventures.

The research house added, however, that MRCB had a new irresistible angle on its property business, which is the possibility of bagging two prime federal land parcels in Kuala Lumpur – 150 acres in Jalan Cochrane near the city centre; and 20 to 30 acres in Jalan Ampang Hilir near the Jalan U-Thant area.

“We estimate that the land parcels could enhance MRCB’s valuation by RM624mil or 69 sen per share,” said RHB Research.


MRCB : [Stock Watch] [News]

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