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MMC buys over Penang Port

MMC buys over Penang Port
MMC Corp is increasing its control over the Malaysian port sector with its port unit MMC Port Holdings acquiring the remaining 51% equity interest in the operator of Penang Port for MYR220m ($49.7m) in cash.

Fresh from a major cooperation deal on the Carey Island project, the utilities and infrastructure group said in a stock market announcement that MMC Port had entered into a conditional agreement with Seaport Terminal (Johore) Sdn Bhd to acquire the remaining 37.46m shares in Penang Port Sdn Bhd (PPSB).

The proposed deal would give MMC full control of PPSB, allowing it to determine the future strategic direction of Malaysia's oldest port.

“This is in line with the initiative of the MMC group to make further strategic investments in one of its core businesses ie ports and logistics division, to strengthen the group’s financial performance and position,” MMC said.

MMC said the proposed acquisition presented an opportunity for it to consolidate PPSB’s earnings in full, thus contributing positively to the group’s future earnings.

This proposal followed an earlier conditional agreement inked by MMC Port to acquire 49% equity interest in Penang Port from Seaport Terminal for MYR200m in cash.

MMC said the purchase would be funded via a combination of internally generated funds and/or bank borrowings, the proportion of which would be determined later.