Wednesday, March 10, 2010
PM Najib’s Cronies and their Related Companies
Everyone knows whenever there’s a change to the premiership not only political landscape changes but also the stock-market landscape. When Mahathir called it a day in 2003 almost immediately his cronies listed companies were affected. The same goes to Badawi although his departure doesn’t have the same impact due to his short-term in office. And now with Najib Razak as the new Prime Minister naturally his cronies or rather those who are closely linked to him are instantly on investors or punters’ radar. Malaysia politics and business model is rather unique because you will see both scratching each other for survival and prosperity. This is something that foreign investors found rather hard though amuse to accept or understand, not to mention frustration due to escalating in business operating costs.
Dow Jones went crazily above the psychological-level of 8,000-points before profit-taking trimmed the gains and closed at 7,978.08, thanks mostly to G20’s pledge of over $1 trillion to combat global economic crisis. However, the KLCI was marginally down following the release of the external trade data by the statistics department. Malaysia exports for February 2009 fell 15.9% year-on-year, while imports were 27.3% lower. Total trade in February was 21% lower at RM67.2bil, with trade surplus of RM11.97bil. The one-day bull in anticipation of Najib’s big day was over with KLCI didn’t move much despite the overnight jump in Dow Jones. Local KLCI is waiting for Najib’s speech to determine the next direction.
If Badawi’s circle of businessmen included Equine Capital Berhad’s Patrick Lim, ECM Libra Group's Kalimullah Hassan and Scomi Group's Kamaluddin Abdullah (his own son), Najib’s circle of businessmen is many times larger. So who are the people and companies closely linked to the new Prime Minister Najib Razak that could see their fortunes skyrocket?
1) Top on the list is non other than his youngest brother Nazir Razak, CEO of Nazir-RazakBumiputra-Commerce Holdings Berhad (KLSE: COMMERZ, stock-code 1023) who studied philosophy at Cambridge University. Perhaps the most business-savvy within the family members Nazir was known for his infamous controversial acquisition of Southern Bank from owner Tan Teong Hean. After failed the initial attempt Nazir turned to Chua Ma Yu who architected the downfall of Southern Bank ultimately. With the largest lender Malayan Banking Berhad’s (KLSE: MAYBANK, stock-code 1155) in its bad shape would we see Bumiputra-Commerce acquire Maybank to become the largest bank instead?
2) Johari Razak, the second eldest who read law Johari-Razakfrom University of Kent is one of the senior partners since August 2007 at Shearn Delamore & Co , a law firm located at Wisma Hamzah-Kwong Hing. He also holds the following positions:
* Ancom Berhad (KLSE: ANCOM, stock-code 4758): Non-Executive Chairman
* Nylex (Malaysia) Berhad (KLSE: NYLEX, stock-code 4944): Non-Executive Deputy Chairman
* Hong Leong Industries Berhad (KLSE: HLIND, stock-code 3301): Non-Executive Director
* Daiman Development Berhad (KLSE: DAIMAN, stock-code 5355): Non-Executive Chairman
* Tower Real Estate Investment Trust (KLSE: TWRREIT, stock-code 5111): Non-Executive Director
* Deutsche Bank (M) Berhad: Director
3) Mohamed Nizam Razak, the middle brother studied politics, philosophy and economics at Oxford University in the UK and was a stockbroker, being CEO of PB Securities Sdn Bhd in the 1990s. He also holds the following positions:
* Hiap Teck Venture Berhad (KLSE: HIAPTEK, stock-code 5072): Non-Executive Director
* Delloyd Ventures Berhad (KLSE: DELLOYD, stock-code 6505): Non-Executive Director
* Mamee Double-Decker (M) Berhad (KLSE: MAMEE, stock-code 5282): Non-Executive Director
* Yeo Hiap Seng (M) Berhad (KLSE: YHS, stock-code 4642): Non-Executive Director
* Deutsche Bank (M) Berhad: Director
Nizam Razak together with Syed Mokhtar were once eyeing for the 19.4% stake in DRB-Hicom held by the family trust of late Yahaya Ahmad.
4) Mohamed Nazim Razak, the fourth brother is an architect who married former host of TV3’s Nona show, Norjuma Habib Nazim-RazakMohamed. He also holds the following positions:
* Hong Leong Bank Berhad (KLSE: HLBANK, stock-code 5819): Non-Executive Director
* Hong Leong Capital Berhad (KLSE: HLCAP, stock-code 5274): Non-Executive Director
Nazim is also the Chairman of Meru Utama Sdn Bhd which won a seven-year advertising concession from Malaysia Airports Holdings Berhad in late 2007. Besides, Nazim is also a director of Eng Wah Organization Limited, a Singapore-based business involved in cinema operations, film distribution and rental of retail and office space. But of course the multi-billion dollar question is would Quek’s Hong Leong Bank leverage on this latest political landscape to acquire Public Bank?
Tan-Kay-Hock5) Tan Kay Hock, chairman of Johan Holdings Berhad (KLSE: JOHAN, stock-code 3441) and George Kent (M) Berhad (KLSE: GKENT, stock-code 3204). Both Najib and Tan Kay Hock are golfing buddies and have known each other for a long time. Tan is also a member of the Iskandar Regional Development Authority (IRDA) and owns 49.59% stake in George Kent. Interestingly, Malayan United Industries Berhad (KLSE: MUIIND, stock-code 3891), controlled by Khoo Kay Peng owns 9.3% stake in George Kent and 7% stake in Johan Holdings.
Robert-Kuok6) Robert Kuok, second PM Abdul Razak and third PM Hussen Onn were childhood friends and their friendship going back to their school days at Raffles School Singapore. Another of their classmate was Lee Kuan Yew, the first PM of Singapore. Razak juniors used to visit their “Uncle Kuok” and although the Malaysia’s richest man’s businesses are mainly based in Hong Kong, he still has leftovers such as Transmile Group Berhad (KLSE: TRANMIL, stock-code 7000), PPB Oil Palms Bhd (KLSE: PPB, stock-code 4065) and Malaysian Bulk Carriers Berhad (KLSE: MAYBULK, stock-code 5077).
7) Shahril Shamsuddin, owner Shahril-Shamsuddinof Sapura Group is said to have close family relationship with Najib. Companies related included SapuraCrest Petroleum Berhad (KLSE: SAPCRES, stock-code 8575), Sapura Industrial Berhad (KLSE: SAPIND, stock-code 7811) and Sapura Resources Berhad (KLSE: SAPRES, stock-code 4596). He is one of the six trusted individuals personally picked by Najib for ideas on issues ranging from economy, capital markets and general business soon after Najib was appointed Finance Minister.
8) Syed Mokhtar Albukhary, the tycoon whose empire is said to be the most comprehensive and includes almost every sector. He also enjoys good relationship with former PM Mahathir and his DRB-HICOM’s assembly plant provides huge employment in Pekan, Najib’s political base. Defence Technologies Sdn Bhd or Deftech, a subsidiary of DRB-HICOM, is Syed-Mokhtar-Albukharythe country’s leading supplier of land-based defence vehicles to the Defence Ministry, Najib’s favorite ministry. Stocks related to Mokhtar Albukhary includes:
* MMC Corporation Berhad (KLSE: MMCCORP, stock-code 2194)
* Padiberas Nasional Berhad (KLSE: BERNAS, stock-code 6866)
* Kramat Tin Dredging Berhad (KLSE: KRAMAT, stock-code 2151)
* Amtek Holdings Berhad (KLSE: AMTEK, stock-code 7051)
* Integrated Rubber Corporation Berhad (KLSE: IRCB, stock-code 2127)
* Tradewinds Corporation Berhad (KLSE: TWSCORP, stock-code 4804)
* Tradewinds Plantation Berhad (KLSE: TWSPLNT, stock-code 6327)
* Zelan Berhad (KLSE: ZELAN, stock-code 2283)
Mokhtar also is very close with Muhyiddin Yassin, the Deputy PM and should Muhyiddin become the next PM, Mokhtar is definitely the businessman to benefits the most. Their relationship started when Muhyiddin was the Johor Chief Minister and Mokhtar was building his empire in the state then.
9) Mohamed Azman Yahya, director of Khazanah Nasional Berhad (KNB) and founder and group chief executive of outsourcing firm Symphony Mohamed-Azman-YahyaHouse Berhad (KLSE: SYMPHNY, stock-code 0016) as well as ex-CEO of Pengurusan Danaharta Berhad. He is one of the six trusted individuals personally picked by Najib for ideas on issues ranging from economy, capital markets and general business soon after Najib was appointed Finance Minister.Listed companies related to Azman includes:
* Bolton Berhad (KLSE: BOLTON, stock-code 1538): Executive Chairman
* Malaysian Airline System Berhad (KLSE: MAS, stock-code 3786): Non-Executive Director
* PLUS Expressway Berhad (KLSE: PLUS, stock-code 5052): Non-Executive Director
* Pharmaniaga Berhad (KLSE: PHARMA, stock-code 7081): Chairman
* Scomi Group Berhad (KLSE: SCOMI, stock-code 7158): Non-Executive Director
10) Rohana Mahmood, Najib’s milieu and chairman and partner of Ethos Capital, a RM200mil private equity firm. Rohana and Omar Mutapha Ong, a former special assistant to Najib, are co-founders of the boutique advisory firm Ethos & Co. She and another close aide of Najib, Abdul Razak Baginda, are co-founders of the independent think-tank, Malaysian Strategic Research Centre. Najib was chairman of the think-tank, now disbanded. Listed companies related to Rohana includes:
* Paramount Corporation Berhad (KLSE: PARAMON, stock-code 1724)
* TH Group Berhad (KLSE: THGROUP, stock-code 8109)
* Dijaya Corporation Berhad (KLSE: DIJACOR, stock-code 5401)
Azman-Mokhtar11) Azman Mokhtar - the managing director of Khazanah Nasional Berhad. He is one of the six trusted individuals personally picked by Najib for ideas on issues ranging from economy, capital markets and general business soon after Najib was appointed Finance Minister.
12) Md Nor Yusof - an ex-banker who was the former managing director of Malaysia Airlines and past chairman of the Securities Commission. He is currently director and chairman of Khazanah’s executive committee. He is one of the six trusted individuals personally picked by Najib for ideas on issues ranging from economy, capital markets and general business soon after Najib was appointed Finance Minister.
Md-Nor-Yusof13) Mohd Nadzmi Mohd Salleh - chairman and MD of express bus operator, Konsortium Transnational Bhd. The former Proton boss was called upon by the Government in 1996 to revive the ailing public transport company. He is one of the six trusted individuals personally picked by Najib for ideas on issues ranging from economy, capital markets and general business soon after Najib was appointed Finance Minister.
14) Bakke Salleh - Felda Holdings Bhd CEO
Nadzmi-Salleh15) Lodin Wok Kamarudin - Lembaga Tabung Angkatan Tentera chief
16) Politicians closely related to Najib - Jamaludin Jarjis, Shafie Apdal, Ahmad Hamidi, Mohamed Nazri Abdul Aziz.
Having said that it doesn’t mean the old cronies during Mahathir time would not shine again since the former premier is expected to play important roles in Najib’s administration as well as to ensure Najib behaves accordingly.