EnCorp

Sources say that Felda Investment Corp (FIC), a newly set up investment arm of Federal Land Development Authority (Felda), is believed to be eyeing for a substantial stake in the mid-cap construction and property group.

In July 2013, the shareholding of Encorp saw a major change when former executive chairman Datuk Seri Dr Mohd Effendi Norwawi decided to sell out via his private vehicle Lavista Sdn Bhd, which owned a 30.55% stake in Encorp.

The stake was bought over by both Encorp group chief executive officer Yeoh Soo Ann and chief operating officer Mohd Ibrahim Masrukin.

For now (15 March 2014), it is still unclear whose block of shares FIC is ogling at.

Among Encorp’s signature development projects in Malaysia and Australia include its flagship Encorp Strand in Kota Damansara, Encorp Cahaya Alam in Shah Alam, The Enclave Hillside Villas in Batu Feringghi, Encorp Marina Puteri Harbour in Nusajaya and Residences on McCallum Lane in Perth.

As at June 2013, Encorp’s gross development value stands at RM3.5bil with its construction division’s order book generating over RM2.2bil and its concessions valued at RM2.2bil.

Set up in July 2013, FIC is one of the four income generating models created by Felda to support the new generations of Felda settlers. Thus, FIC has been tasked to monetise Felda’s existing assets including 22-acre prime land bank in Kuala Lumpur and hotels by way of undertaking ventures in property-related projects and further develop Felda’s hotel ventures under the Felda Residence brand name, among others.

It was reported that FIC via Felda also have some RM8bil worth of quoted and unquoted shares in companies in Malaysia.

Sources said that FIC is currently (March 2014) identifying new businesses and also streamlining its existing ones. For now (March 2014), the core businesses identified by FIC include hotels/hospitality, property development, travel/tourism and manufacturing businesses.

Under hotels and hospitality, which Felda has been involved since 1991, sources point out that FIC is in the process of rebranding and considering a name change for its Felda Residence (FR) chain of hotel.

There are seven Felda Residences in the country including FR Tekam in Pahang, FR Trolak and FR Hotsprings in Perak, FR Kuala Trengganu in Trengganu, FR Sahabat in Sabah and FR Tanjung Leman in Johor. This exclude the three new ones bought over by FIC in 2013 namely Hotel Grand Borneo in Sabah for RM86mil, Hotel Sri Costa in Malacca for RM24mil and UK-based Grand Plaza serviced apartments in Bayswater central London for a hefty RM497mil.

FIC came under heavy criticism from the detractors of Felda last year for splurging over RM600mil on the three ventures within a short span of five months prior to March 2014.

Meanwhile Encorp expects to continue on its growth trend and sustain its revenue growth this year from progress billings generated from the lock-in sales of RM727.5mil comprising the projects of Encorp Marina Puteri Harbour in Nusajaya, Encorp Cahaya Alam in Shah Alam and Encorp Strand Residence in Kota Damansara.

Yeoh had earlier denied that Encorp was disposing its only shopping centre asset, Encorp Strand Mall in Kota Damansara, and that an interested party had offered RM400mil to buy the mall. He said the company was keeping the shopping centre for future recurring income.

The Encorp Strand Mall is projected to strengthen the group’s financial performance for the financial year ending 2014.

Contrary to the speculation of the sale of the mall, he said preparations were going full swing for the mall’s grand opening in April 2014.