Shame On The 60.39% Who Voted For Genting Malaysia's UK Casino Purchase

On Star Biz: Genting M’sia gets nod for UK casino purchase

• Wednesday August 25, 2010
  Genting M’sia gets nod for UK casino purchase
  By FINTAN NG
  
  Shareholders approve the deal after initial misgivings
  
  KUALA LUMPUR: Shareholders of Genting Malaysia Bhd voted yesterday in favour of resolutions to acquire the British casino operations collectively known as Genting UK from Genting Singapore plc despite initial misgivings over the related party transaction nature of the deal.
  
  It is understood that shareholders mainly asked questions on the rationale for the acquisition and on profitability, as Britain is not seen as a growth market due to prevailing economic conditions and tougher operating conditions.
  
  “Shareholders wanted more clarification on the acquisition and whether it’ll be profitable,” a shareholder said, adding that HSBC Nominees and Cartaban Nominees called for a poll before the voting.
  
  The vote was 60.39% or 1.17 billion shares, for the acquisition, which was worth RM1.67bil. Genting Malaysia, the owner and operator of Resorts World Genting, is 47.33% owned by Genting Bhd, which also owns a 52% stake in Genting Singapore.
  
  The over-lapping shareholding among certain institutional shareholders in Genting Malaysia and Genting Singapore could have been a major catalyst in the way the voting turned out as it did. Blackrock Fund Advisors and Vanguard Group Inc were among those with stakes in both companies.
  
  Genting and its chairman cum chief executive officer Tan Sri Lim Kok Thay did not take part in the voting.
  
  An analyst with a foreign investment bank told StarBiz that the voting pattern showed that these shareholders preferred to see the British casino operations, which faced quite a few obstacles including higher taxes and a tougher operating environment, under Genting Malaysia.
  
  Analysts in recent reports said the British casino operations were a better fit for Genting Malaysia rather than for Genting Singapore.
  
  As for Genting Singapore, the analyst said this would look good for the company, which would be able to concentrate on the integrated resort business.
  
  Moreover, the gaming industry in Singapore was recently re-rated with Genting Singapore showing sterling results.
  
  A market observer noted that in a situation where there were overlapping institutional investors and better prospects in Singapore, it was “normal to make Genting Malaysia a sacrificial lamb to help Genting Singapore”.
  
  He added that based on the number of shares, it appeared that these institutional shareholders were quite active in voting.
  
  Meanwhile, Genting Malaysia deputy chairman Tun Mohd Haniff Omar said all proposals to expand the business were looked at based on merits by the company’s board, including those involving related party transactions.
  
  “We’ve this opportunity in Europe (with Genting UK), we hit the ground running with a going concern that is already cash flow positive following the remedial measures taken by Genting Singapore,” he said.

A terribly sad day for corporate Malaysia.

Quote: "Shareholders approve the deal after initial misgivings"

Well, lets be more accurate and state it boldly that 60.39% voted for the deal.

Which means some 39.6% voted against!!!!

Which means some 39.6% understands the utter nonsense in this RELATED PARTY TRANSACTION!

Yeah... Genting Malaysia's UN Fortunate Entry Into UK Casino Business

And this 2nd July 2010 news flash said it all...

• DJ MARKET TALK: Genting Singapore +1.7%; Fortunate UK Exit -Citi
  Dow Jones Newswires 02 Jul 2010 9:50am
  
  0150 GMT [Dow Jones] Genting Singapore (G13.SG) +1.7% at S$1.20 as proposed GBP340 million (S$688.8 million) sale of money-losing U.K. operations to sister company Genting Malaysia (4715.KU) fuels hopes for stronger earnings profile. While Genting Singapore will book FX translation loss of S$338 million this year, bottom-line excluding exceptional item expected to improve. "Considering that the U.K. gaming operating business remains very tough, we view this exit as an escape for Genting Singapore and we view it as fortunate in that there was a buyer in the market," says Citigroup; "it means Genting U.K. will no longer drag on the performance of Resorts World Sentosa." Still, keeps Sell call, S$0.65 target on valuation grounds. Orderbook quotes suggest minimal upside beyond S$1.23.

Fortunate that the buyer was related to Genting Singapore!

Fortunate that Genting Malaysia is buying a business which operates in a very tough business environment!

Good to be related, eh?

Good that the deal is voted through, eh?

ps: For the BRAVE 39.6%, you can still VOTE with your feet!