Khazanah Nasional, the Malaysian state investment company, is looking to build two or three regional champions through acquisitions by 2015, with a focus on the banking and telecommunications sectors.
Azman Mokhtar, the managing director, said on Wednesday that Khazanah was seeking to copy the success of Temasek Holdings, the Singapore state investment company which has invested heavily in Asia, as it expands its portfolio abroad.
Mr Azman said that banking and telecoms were attractive because both industries had strong cashflows and were among the most liberalised in the region. The group is also interested in infrastructure investments, including in the Middle East.
Khazanah’s strategy would pit it directly against Temasek, which has focused on banking and telecoms over the past several years with the takeover of Thailand’s Shin Corp and the acquisition of stakes in Chinese and Indonesian banks. The net value of Khazanah’s assets, at M$57bn (US$16.4bn) is dwarfed by those of Temasek, whose portfolio amounted to S$129bn (US$84.7bn) last March.
Maybank and Telekom Malaysia are seen as the most likely candidates to lead Khazanah’s international expansion.
Mr Azman said Khazanah’s financial strength was improving, with the market value of its top 20 companies having increased to M$228bn in March from M$145bn in May 2004, when a restructuring programme for the state industrial sector was launched. Khazanah companies make up a third of the market capitalisation of the Kuala Lumpur stock exchange.
Khazanah is planning to sell stakes in several troubled companies as part of its restructuring, with Proton, the national carmaker, heading the list. The government has set a deadline of the end of the month to find a strategic partner for Proton, and the company has been in talks with Volkswagen and General Motors.
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