UEM EDGENTA BERHAD (“ UEMEd ” or the “Company”) PROPOSED DISPOSAL OF 61.20% EQUITY INTEREST IN OPUS INTERNATIONAL CONSULTANTS LIMITED (“OIC”) Empowered by science, inspired by humans
Contents
Section 1 Overview of the Proposed Disposal
• • PROPOSAL • • BACKGROUND • • OFFEROR • 4
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Section 2 Overview of the OIC Group
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• 26.2 539.6 16.8 505.2 470.9 6.2 226.8 -29.9 FY2014 FY2015 FY2016 FPEJune 17 FY2014 FY2015 FY2016 FPEJune 17 8
3,123.0 350.8 2,931.0 237.8 79.8 1,374.5 1,359.7 223.2 47.5 161.1 34.9 13.3 1,748.5 190.3 271.0 1,571.3 188.3 147.8 RM million UEM OIC RM million UEM OIC Edgenta Contribution Edgenta Contribution Revenue 3,123.0 1,374.5 44% Revenue 2,931.0 1,359.7 46% 237.8 47.5 20% Normalised PBT Normalised PBT 350.8 79.8 23% Normalised PBT 8.1% 3.5% Normalised PBT 11.2% 5.8% Normalised PATANCI 161.1 13.3 8% Normalised PATANCI 223.2 34.9 16% Normalised PATANCI 5.5% 1.0% Normalised PATANCI 7.1% 2.5% 9
• • • 2 1.8 1.6 1.4 1.2 1 0.8 0.6 10
Section 3 Key Terms of the Proposed Disposal
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Section 4 Rationale of Proposed Disposal
1 • Streamline operations and re-allocate resources into other core businesses i.e. healthcare, infrastructure and real estate sectors which are expected to continue to see positive returns • No significant impact to UEMEd’s overall operations, as OIC has operated Strategic focus & largely independently. Streamline operations • We will continue to retain and drive growth of Malaysian asset consultancy business via OIM and will be able to continue to draw on experience and resources of OIC as a 3 rd party consultant 2 • A premium of 93.9% against the share price as at 11 August 2017 Opportunity to unlock • Disposal Proceeds of NZD173.8 million/RM528.6 million value of equity stake in OIC • An estimated gain on disposal of RM292.3mil 3 • Canada and Australia have been negatively impacted by offshore challenges Reduce exposure in underperforming markets and slow-down in the oil & gas industry and the mining industry 4 Enhance gearing position • Gross Gearing to reduce from 0.64x to 0.22x (Proforma as per 31 Dec 16) & • Estimated savings of financing costs of RM20.0 mil over 2 years Savings of financing costs 16
• Audited as at 31 Proforma - After the December 2016 Proposed Disposal % Movement RM’000 RM’000 NA per Share 1.65 1.97 +19.39% (RM) Gross Gearing 0.64 0.22 -65.63% (x) PATANCI 80,056 368,983 +360.91% EPS (sen) 9.68 44.63 +361.05% 17
Purpose RM million Timeframe (from completion) Repayment of borrowings (1) 415.2 Within 6 months For general corporate purposes 110.0 Within 24 months and working capital (2) Estimated expenses for the 3.4 Within 1 month Proposed Disposal Total 528.6 18
Business Segmentation Current Business Segmentation Post Disposal of OIC CONSULTANCY SERVICES SOLUTIONS CONSULTANCY SERVICES SOLUTIONS HEALTHCARE HEALTHCARE INFRASTRUCTURE INFRASTRUCTURE REAL ESTATE REAL ESTATE WATER 19
Healthcare Sector Infrastructure Sector Real Estate Sector ORGANIC GROWTH • Actively pursuing project opportunities (e.g:SKLIA,MRT, HSR) • Harnessing revenue synergies and cross selling opportunities (Expanding Offerings into commercial healthcare sector) • Expanding portfolio (Expanding township and building portfolio in southern region) • Core markets (Malaysia, Indonesia, Singapore, Taiwan and Middle East) OPERATIONAL FOCUS • Driving Operational Excellence and Organisational Excellence to improve performance delivery ofour services • Implementation of Enterprise Resource Planning (ERP) to enhance back-end support system and integration of processes • Technology Enablers (UETrack, Command & Contact Centre, Communa) 20
• • We will be able to streamline our operations and re-allocate resources into our core businesses • Key Rationale It is an opportunity for us to unlock value of our equity stake in OIC with estimated gain of RM 292.3 million • Our exposure in underperforming markets will be reduced • There will be no significant impact to UEMEd’s operations , as OIC has operated largely independently UEMEd’s Asset • We will still retain OIM , an entity that focuses on project management and Consultancy design consultancy operating in Malaysia and Indonesia Offering • We will be able to continue to draw on experience and resources of OIC as a 3 rd party consultant and by extension, WSP’s wide ranging engineering capabilities • We will focus on 3 key offerings across 3 key sectors , i.e. Healthcare, Business Focus & Infrastructure & Real Estate Strategic Direction • Deliver organic growth & focus on operational and organisational excellence 22
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