In his speech unveiling the NEM, the PM also touched on the need for greater public-private cooperation. With these, it help to promote competition across and within sectors to revive private investment and market dynamism.
The following are the list of Petronas and Ministry of Finance (MOF) subsidiaries which going to be privitized.
Although the PM did not identify the subsidiaries to be listed, there are rumors that the 2 subsidiaries could be Petronas Carigali Sdn Bhd, a 100% subsidiary of Petronas and Malaysia LNG Sdn Bhd, a 90% subsidiary.
Petronas Carigali Sdn Bhd
Petronas Carigali is involved in both O&G exploration and production activities. Incorporated in 1978, it is the exploration and production arm of Petronas.
Exploration and production activities use up to 60%-70% of Petronas’ total capex spending. Hence, this division may wish to have the added option of securing fresh funds from the equity market. Nevertheless, there is possibility of Petronas separating the exploration and production activities into 2 business segments so that only one of them may be listed.
Exploration and production contribution is 18 per cent from operating profit level of Petronas, which registered a net profit of RM52.5 billion for financial year 2009. Assuming the same percentage at net profit, Petronas Carigali could have recorded RM9.7 billion in net profit. And assuming it was 15 times per earning ratio, the market capitalisation could be RM146 billion, which is three times larger than Sime Darby’s market capitalisation
Malaysia LNG Sdn Bhd
The other potential subsidiary for listing is Malaysia LNG, which is involved in the management and operation of the LNG complex in Bintulu, Sarawak and the marketing of LNG to overseas buyers. The LNG complex, located in Bintulu, Sarawak is also one of the world’s largest LNG production facilities at a single location, with a combined capacity of 23m tones p.a.
Ministry of Finance (MOF) subsidiaries
Percetakan Nasional Berhad
Percetakan Nasional Berhad (PNMB) was established as the largest printing company in Malaysia. Formerly known as Jabatan Percetakan Negara (JPN), PNMB was incorporated in 1993.
PNMB is a wholly owned company under the Ministry of Finance and undertakes all the printing and press work for the Government, the private sector and the general public. It provides one-stop printing services, plastic card printing, paper-based ticketing, outdoor signage and electronic document management system, online ordering and door to door services. Most of its revenue is from the government sector, with a small contribution from the private sector.
Ninebio was incorporated in 2006 as a wholly-owned company of the Ministry of Finance. Formerly known as National Institute for Natural Products, Vaccines and Biologicals (NINPVB), Ninebio focuses on research and development and the manufacture of vaccines and biologics for protection against life-threatening diseases.
Inno Biologics specializes in mammalian cell culture technology and operates the state-of-the-art cGMP facility for the production of bio-pharmaceuticals. The facility is built to comply with European Medical Agency (EMEA) and United States Food and Drug Administration (FDA) regulatory requirements.
They offer complete services from upstream to downstream operation for the development of therapeutic proteins such as cell line development, antibody services, process development, cGMP manufacturing, and contract research as well as training. It has been picked by the largest drugs contract manufacturer in the world, the Boehringer Ingelheim group, to be its partner in Asia.
Composites Technology Research Malaysia Sdn Bhd
Composites Technology Research Malaysia Sdn Bhd (CTRM) was incorporated in 1990 with MOF Inc owning 92% and Petronas the remaining 8%. CTRM is entrusted with a strategic role to develop the aerospace and composites industries. In line with this vision, CTRM started operations with the assembly and manufacturing of a two-seater composites light aircraft, Eagle 150B.
Today, CTRM is part of the global supply chain supplying composites aero structures for major commercial and military aircraft manufacturers in the world. Apart from the manufacture of composites aero structures, CTRM also provides engineering design services, composites assemblies, composites R&D, manufacturing of automotive composites structures and manufacturing of defence related equipments, including the Tactical Unmanned Aerial Vehicle. Its orderbook as of end-2009 was RM8.5bn.
It turn out that Petronas subsidiary that going to be listed in Bursa Malaysia is its petrochemicals business and MISC Bhd’s heavy engineering unit, Malaysia Marine & Heavy Engineering Sdn Bhd not Petronas Carigali and Malaysia LNG as speculated earlier.