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According to an announcement by Bursa Malaysia, that the new board structure, which is the Main Market and ACE Market, is on schedule to be implemented on 3 August 2009.

As part of a market-based approach, the streamlining of the boards structure entails a new regulatory framework for listing and equity fundraising which was announced by the Securities Commission (SC) and Bursa Malaysia on 8 May 2009. With this, Bursa Malaysia’s Listing Requirements has been revamped to cater for the new structure.

Under the new structure, Main and Second Boards will be merged into a single unified board for established companies and will be called the Main Market. The current MESDAQ Market, which is for technology-based and high growth companies, will also be transformed into an alternative market for emerging companies of all sizes and sectors and will be called the ACE Market.

The new board structure provides companies with a clearly defined platform to raise capital, which will enhance efficiency, access and certainty in the fund raising process as well as ensuring that investor protection remains intact.

Following from the change, the FTSE Bursa Malaysia Second Board index will retire while the FTSE Bursa Malaysia MESDAQ index will be renamed as the FTSE Bursa Malaysia ACE index. Eligible Second Board constituents will be absorbed into the Main Market indices. These changes will take effect on 3 August 2009.

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RAM Rating Services Bhd (RAM Ratings) has revised downward its gross domestic product (GDP) forecast for 2009 to a 3.3 per cent decline from its earlier estimate of 0.9 per cent growth.

However, it has raised the country’s GDP forecast for 2010 to 4.9 per cent from 3.8 per cent as the global recession eases and benefits from aggressive monetary and fiscal stimulus measures filter.

The downward revision came primarily because of a sharper-than-anticipated decline in both external and domestic demand.

In its “Economic Outlook Review and Update” report issued yesterday, the local rating agency said a contraction in global output is now inevitable in 2009.

“Since our GDP forecasts released in February, there have been marked downward revisions in the growth expectations of Malaysia’s trading partners. In this context, we revisit the risk of a deeper export shock and its second-order impact on domestic demand in Malaysia,” it said.

RAM said the collapse in domestic demand in the first quarter of 2009 had shown closer-than-expected linkage with the export-oriented sector through the labour market and private investment.

It said Malaysia’s recovery in 2009 and 2010 will likely be modest due to the present lack of export demand in crisis-hit countries, mainly comprising advanced economies.

Similarly, economic growth in export-driven countries is also envisaged to remain weak over the same period.

“With only tepid recovery now the most likely outcome for advanced economies, Malaysia’s export performance in 2009 has been revised downwards to a 17.4 per cent contraction (from an initial 5 per cent decline), before a moderate 6.4 per cent recovery in 2010,” it said.

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John Master Industries Bhd, which said last month that it planned to sell the business and return capital to shareholders, will stay listed on the local bourse after a reverse takeover by a Chinese textile maker.

It may become the fourth company from China to be listed on Bursa Malaysia once several corporate exercises are completed by the first quarter of next year.

Xingquan International Sports Holdings Ltd, a Chinese shoemaker, was the first direct foreign listing in Malaysia last month. Another China firm, Multi Sports Holdings Ltd, is due to be listed soon.

Sino Hua-An International Bhd was the first China company to go public here via a back-door listing when it took over Antah Holdings Bhd’s listing status in March 2007.

John Master said yesterday that it will sell the entire clothing and property business through an open tender for RM78.5 million and return RM77.5 million, or 63 sen per share, to shareholders after deducting the expenses involved.
After that, it will issue new shares, convertible bonds, and make a rights offer to buy China-based Be Top Group Ltd, the holding company of fabric maker Top Textile (Suzhou) Co, for RM328 million.

Be Top’s owners, Pan Ding and Pan Dong, will own more than 51 per cent of the company after the deal, while John Master’s existing key shareholder, the Ho family, may hold up to 9 per cent. The new owner is providing a profit guarantee of at least 100 million yuan after tax for financial year 2009.

“We are excited with John Master’s re-emergence as a China-based manufacturing powerhouse. Shareholders will have the choice of re-investing in a transformed company or keeping the cash from the capital repayment,” John Master executive director Jackson Ho said in a media briefing in Kuala Lumpur yesterday.

John Master shares rose 8.1 per cent to close at 73.5 sen on Monday before trading was suspended for the announcement yesterday.

Trading in the stock will resume this morning. The stock has risen 67 per cent this year, with most of the gains made in the last one month or so.

Be Top Group received approval to float its shares in Singapore last August, but the plan was put on hold due to the financial crisis. It turned to Malaysia because the stock market here is more stable and less affected by the credit crunch, founder Pan Ding said.

“John Master has also shown great faith in us after visiting our factory in China. The major shareholder is staying on as an investor after the deal. I believe other existing investors will continue to stay on board,” Pan Ding said.

Be Top’s garment products are sold to many well-known brands in China, he added, and the industry has huge potential as the country’s 1.3 billion people are beginning to see clothing as a fashion item rather than basic essentials given the rising affluence.

Be Top’s products are also exported to established Western chain stores like Wal-Mart, Target, Sears, Marks and Spencer, and H&M.

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