Khazanah to divest property developer STLR to boost Bumi equity
Najib announced in February that Khazanah and PNB would each sell off five non-core firms to “worthy’ Bumiputera entrepreneurs. — File picKUALA LUMPUR, June 4 — Property developer STLR Sdn Bhd is the first government company being sold to qualified Bumiputera entrepreneurs under a divestment exercise mooted by Putrajaya to help grow the community’s equity.
STLR owns a prime 2.9 acres of residential-zoned land in Bukit Tunku here and has signed with Iskandar Investment Bhd (IIB) to acquire an interest in a 1.3 million-sq ft plot of developmental asset for mixed development projects in Medini, Iskandar Malaysia.
“The company was chosen for this divestment exercise as it could offer an opportunity for the acquiring party to tap into the prospects of a mature township in Kuala Lumpur and the exponential growth of a fast-growing township in Medini, Iskandar Malaysia,” state asset manager Khazanah Nasional Berhad said in a statement today.
“The divestment exercise will also allow STLR to enjoy financial and strategic benefits through the ownership and management of a qualified Bumiputera company with expertise in the relevant field,” it added.
The state strategic investment fund said the proposed divestment would involve a three-stage bidding process via open tender — pre-qualification, indicative bid and binding bid — and STLR’s new owner would be selected based on both financial and strategic considerations.
The potential buyer must fulfil several pre-qualifying criteria including being a 51 per cent Bumiputera-owned and managed company with good financial track record and experience in the relevant sector, it added.
Other criteria include the possession of a viable business plan, strong entrepreneurship and business acumen, and an offer of the best bid for value creation.
Khazanah said an independent panel will preside over the bidding process, which it pledged would be conducted in a “transparent and merit-based manner”.
“The proposed divestment of STLR... is part of Khazanah’s efforts to assist the government in encouraging entrepreneurship and growing Bumiputera equity,” it added.
The sovereign wealth fund also said the exercise was part of its overall divestment strategy of disposing non-core businesses gradually to fulfil the role of government-linked investment companies (GLICs) and government-linked companies (GLCs) under the New Economic Model (NEM).
The notice on the offer for sale of STLR by Khazanah will be advertised in all major newspapers this week.
Between 2004 and last year, Khazanah has divested a total of 45 assets and companies valued at some RM31.7 billion to notable firms like Pos Malaysia, Time dotCom and the Royal Mint Exchange.
Earlier in February, Prime Minister Datuk Seri Najib Razak had announced that Khazanah and Permodalan Nasional Bhd would be asked to transfer a total of 10 non-core businesses to worthy Bumiputera-owned firms to help boost the community’s equity interest.
Bumiputera equity stood at 22 per cent in February last year, short of the 30 per cent target set by the government.
“Bumiputera companies will be invited to take part via an open evaluation process... and (divested) companies will be transferred to the best, most secure and capable (Bumiputera) companies,” Najib had said after attending a Bumiputera Agenda Action Council meeting.
He added that Khazanah and PNB would each be asked to divest five companies. STLR is among one of the five firms identified by Khazanah for the exercise.
