MY Morning Wrap | Paramount Acquires 21.54% Stake in Eco World International for $40.8m

The $S&P 500 Index (.SPX.US)$ continued its upward momentum last Friday, inching closer to its all-time closing high of 5254.35, supported by gains in consumer staples, technology, financials, healthcare, and industrials. Meanwhile, semiconductor stocks, including Nvidia, helped reduce losses for the $Nasdaq Composite Index (.IXIC.US)$ after strong revenue data from Taiwan Semiconductor Manufacturing Company dispelled worries about valuations. The $Dow Jones Industrial Average (.DJI.US)$ rose for an eighth straight session, closing 0.3% higher at 39512.84, while the Nasdaq swung between gains and losses before ending 0.03% lower at 16,340.87.

$AWANTEC (5204.MY)$: AwanBiru Technology, previously known as Prestariang, has been lifted from its status as an affected listed issuer by Bursa Securities after three years. The company said it had complied with the criteria for upliftment and has been granted a waiver from being classified as an affected listed issuer. The trading suspension of Awantec shares has also been lifted by the exchange regulator and will take effect from next Monday.

$ECOWLD (8206.MY)$: Paramount Corp has acquired a 21.54% stake in Eco World International for a cash sum of MYR170.61m ($40.8m). Wholly owned subsidiary Flexsis bought the shares at MYR0.33 per share from GLL EWI, a unit of GuocoLand, which is controlled by Tan Sri Quek Leng Chan. The acquisition is part of Paramount's overseas expansion and diversification plan, and will make Flexsis the second-largest shareholder in EWI after Eco World Capital. GLL's stake will be reduced to around 5.46%.

$INNATURE (5295.MY)$: InNature Bhd has announced its acquisition of Blu Restaurant Sdn Bhd, the operator of Burger & Lobster restaurants, for MYR21.25m ($5.1m) in a related-party deal. The company will use MYR14.6m of the proceeds from its 2020 initial public offering to fund the acquisition, with the rest paid with internal cash. The move is part of InNature's diversification plan and provides an opportunity for the company to expand into the food-and-beverage business.

$MI (5286.MY)$: Mi Technovation Bhd has reported a net profit of MYR26.79m ($6.4m) for the first quarter ended March 31, 2024, up from MYR6.4m in the same period last year. The rise was driven by a 39.4% year-on-year increase in revenue, which reached MYR107.13m, boosted by strong demand from customers and foreign exchange gains. The semiconductor equipment business contributed 57.2% of total revenue for the quarter, while the semiconductor material business made up 42.8%.

$MAA (1198.MY)$: MAA Group Bhd has purchased an additional 4.98% stake in KNM Group Bhd, a troubled Practice Note 17 company, for MYR33.24m ($8m), at an average price of 16.5 sen per share. The shares were acquired via a direct business transaction between February 8 and May 10, 2024, raising MAA's direct and indirect stake in KNM to 13.54%. The move is expected to provide MAA with an opportunity to participate in any future potential capital appreciation in the value of its investment in KNM.

$PHARMA (7081.MY)$: Pharmaniaga Bhd has assured shareholders that it is committed to financial recovery, despite its weak financials being flagged for a second consecutive year by its independent auditor, PricewaterhouseCoopers PLT. The company said it has made "strong and steady progress" on this, backed by resilient fundamentals and clear strategies to exit its Practice Note 17 (PN17) status via the regularisation plan it submitted to Bursa Malaysia in February. This statement comes after PwC raised doubts about the company's ability to continue as a going concern, citing continued losses in the financial year ended Dec 31, 2023, current liabilities that exceeded current assets, and capital deficiency.

$JIANKUN (8923.MY)$: Jiankun International Bhd has redesignated Datuk Saiful Nizam Mohd Yusoff, its president, as non-independent and non-executive chairman, effective from Friday. The move came after the resignation of Tan Sri Mohamed Apandi Ali as chairman of the loss-making property development and construction group on April 30. Saiful Nizam, who holds a 0.51% stake in Jiankun, previously served as the company's president. He is the son-in-law of the deputy prime minister of Malaysia, Datuk Seri Dr Ahmad Zahid Hamidi.

$NOVAMSC (0026.MY)$: Singapore-based family office Mark Investment Group VCC is considering investing about RM41m ($10m) in two subsidiaries of software company Nova MSC Bhd. The firm is interested in investing S$5m ($3.7m) in Nova MSC's 60%-owned Dex-Lab Pte Ltd, which develops social robots, and US$5m ($21.2m) in Nova MSC's 42%-owned EyRIS Pte Ltd, which develops artificial intelligence for automated image analysis for eye diseases. The investments are subject to due diligence and negotiations, according to non-binding term sheets signed with the subsidiaries.

$SCABLE (5170.MY)$: Sarawak Cable Bhd has identified "a strong alternative party" interested in leading a resuscitation plan for the loss-making cables maker, after its plan to regularise its financials with the help of UK-based Serendib Capital Ltd failed. The company said it was unable to reach an agreement with Serendib Capital on their working relationship, given a delay in proposing and implementing any debt settlement with the company's creditors within the agreed-upon period under the memorandum of agreement signed in December last year. The termination of the MOA with Serendib would not affect the group's plan to exit its Practice Note 17 status, Sarawak Cable said.