Dubai World reassessing RM16b investment

Written by Jose Barrock

Wednesday, 19 August 2009 11:24

KUALA LUMPUR: Dubai World has had to rethink its priorities with regard to its RM16 billion maritime centre master plan and a proposed partnership with conglomerate MMC Corp Bhd.

In a statement to Bursa Malaysia, MMC said the reassessment came about as a result of the economic crisis, which had impacted the global community.

“Dubai World is reassessing its priorities with respect to its investment allocation. Hence, there is no further progress on the MoU since the last announcement in May 2009,” said MMC.

MMC had said in May that Dubai World was assessing its options with respect to its interest in the maritime centre master plan, given the current economic climate in Dubai.

The plan which was mooted in September 2007 involved the building of a maritime centre, including oil terminal activities, dry docks, a shipyard, conventional cargo-handling facilities, logistics parks and property development in south Johor. The development would cover MMC’s landbank of some 2,255 acres at Tanjung Bin.

This re-evaluation by Dubai World came on the back of another pullout by one of Dubai’s largest private developers. In June, Damac PROPERTIES [] (Malaysia) Sdn Bhd, a unit of Damac Properties LLC, opted out of a plan to buy land in Nusajaya, Johor for RM396.5 million.

In its announcement to Bursa Malaysia almost two years ago, MMC had said that the plan with Dubai World would enable it to develop the hinterland of port operator Pelabuhan Tanjung Pelepas Sdn Bhd (PTP) and unlock the value of MMC’s landbank in Tanjung Bin. PTP is a 70% unit of MMC.

Separately, MMC yesterday said it posted a net profit of RM150.78 million on the back of RM2.2 billion revenue for its second quarter ended June 30. Compared to a year earlier, the net profit was 36.4% lower while revenue was 10% higher.

MMC said its results were adversely impacted by the economic downturn, which resulted in lower contribution from its transportation and logistics division and by losses absorbed from its unit ZELAN BHD [], which amounted to RM78.6 million, in its projects in the Middle East among others.

MMC slipped five sen to end trading at RM2.48 yesterday.

This article appeared in The Edge Financial Daily, August 19, 2009.

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Last Updated on Wednesday, 19 August 2009 11:25

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