Khazanah to take control of Pantai

Business Times: KHAZANAH Nasional Bhd moved yesterday to take control of Pantai Holdings Bhd, the country's biggest healthcare firm, from its Singaporean shareholder and help cool a political hot potato for the Government.
Matters became hot when politicians and lawmakers started questioning Singapore-based Parkway Holdings Ltd's takeover of Pantai and its two government concessions in the medical field.
The politicians from the ruling political party said they were unhappy that the concessions - one for health screening of foreign workers and another for the provision of state hospital services - had fallen into foreign hands.
Parkway moved into Pantai last year after buying the bulk of its shares from Pantai's chief executive officer Datuk Lim Tong Yong.
Lim had acquired a 32.85 per cent interest in the company from former Prime Minister Tun Mahathir Mohamad's son, Mokhzani Mahathir, in 2001.
This prompted Prime Minister Datuk Seri Abdullah Ahmad Badawi, two weeks ago, to say the government was seriously studying the matter, and resulted yesterday in Khazanah's sudden strategic move.
For a start, Khazanah has bought a 6.6 per cent stake, or 30.92 million shares, in Pantai through its wholly-owned unit Pantai Irama Ventures Sdn Bhd for an undisclosed price.
It will then buy the entire 26 per cent stake owned by Parkway for RM2.65 a share. Pantai Irama will then make a general offer (GO) to purchase the rest of the shares at the same price, which values Pantai at RM1.25 billion.
"We believe the strategic interests of the nation will be protected in this manner, and the commercial interests of Pantai and its investors - including both major and minority investors - will also be served with this partnership," Khazanah said.
Pantai closed at RM2.51 last Friday. The shares were suspended from trading yesterday. Trading will resume today.

Pantai recently turned down offers from two consortia of investors to acquire its subsidiaries - Pantai Medivest Sdn Bhd and Fomema Sdn Bhd - both of which hold the concessions.
Fomema holds a 15-year concession to carry out medical check-ups for all foreign workers in the country. The concession expires in September 2012.
Pantai Medivest holds a 15-year concession from October 1996 to provide hospital support services in Negri Sembilan, Malacca and Johor.
Medivest and the Fomema group of companies are Pantai's main sources of income, accounting for about half of Pantai Holdings' group sales and over 40 per cent of the group's operating profit.
Parkway, however, will not exit Pantai completely. It will buy 49 per cent of Pantai Irama from Khazanah and will manage hospitals under Pantai.
Under the GO, Pantai Irama will also make an offer of RM1.53 each for all outstanding warrants and RM2.53 per irredeemable convertible unsecured loan stocks.
For the GO to proceed, Pantai Irama must have more than 50 per cent of Pantai. Due to the small premium in the offer, Pantai is unlikely to be taken private, some analysts said.
"What is interesting is to see Khazanah and Parkway coming in together to manage Pantai. Khazanah's move is good in a sense that it helps to calm the political storm swirling around Pantai.
Khazanah said its investment in Pantai is strategic.
The deal complements its other healthcare ventures in India and allows it to tap further into the Malaysian hospital market.
It currently has shares in Malaysia's pharmaceutical firm Pharmaniaga Bhd and India's Apollo Hospitals.