Best prospects
Cahya Mata Sarawak (CMS) is a major private-sector conglomerate in Sarawak. The portfolio of the Bursa Malaysia-listed enterprise spans over 40 companies involved in cement manufacturing, construction, trading, property development, financial services, education, and others. Inside Investor talked to Group Managing Director Dato Richard Curtis about the company’s development and the future plans.
Q: You are running a conglomerate of over 40 companies. What sector is the biggest revenue contributor?
A: The biggest revenue contributor is our cement division. We are running two cement plants, a clinker plant, and also make concrete products. The second biggest contributor is our construction material sections, where we quarry stones and aggregates and manufacture premix.
Q: Are there any sectors you would like to add to your business?
A: Our future plans for growth have two focuses. The first is around our existing businesses. We want to grow in tandem with the economic growth of Sarawak, driven largely by SCORE, and maximise all the opportunities within the state. The other focus is that we wish to make strategic investments into SCORE projects. We already have made a major investment into OM Sarawak’s manganese smelter operations, having taken a 20 per cent stake. We are also the lead partner for the development of the township in Samalaju and are involved in providing workers’ camp services. Furthermore, we are looking actively for other strategic investments into SCORE projects where we could participate. We wish to be seen as a major local player that provides some involvement for the Sarawak private sector in these investments.
Q: Who stands behind CMS? Who are the major shareholders?
A: Members of the founding Taib family are the leading shareholders. In addition to that, we have major institutional investors which include the Employees Provident Fund, the Sarawak Economic Development Corporation, and other big institutions.
Q: How many people are working for CMS and where do you get all the qualified personnel from?
A: Currently we have 1,995 employees, with 95 per cent of them being Sarawakians. We have a strong policy of employing local people. The remaining five per cent are mostly West Malaysians, mixed with a few expatriates. One of the unique things about Sarawak is the low staff turnover, as people don’t like to change their jobs. This means we invest a lot into training our staff and into career planning for everyone. We have also instituted a management training programme, where we train young graduates, attach them to different business units, and see them as part of what we call the group’s talent pool. We know that the new generation of employees won’t be so loyal and conservative like the older generation, so we have to make sure that we are an employer of choice.
Q: Are you actively looking for project partners or foreign investors for specific businesses? Do you have any business relations to the GCC?
A: No, we are not. We are actually a company that gets approached by foreign investors who want to come to Sarawak, and we keep an eye open for them. We have a healthy balance sheet, a professional and independent management team, and we know the state well. When foreign investors come here looking for a local partner, they may come to us. Regarding the Middle East or the GCC, we don’t have any business relations at present. There had been talks with Middle Eastern companies, but so far nothing has been concluded.
Q: Do you have any expansion plans beyond Sarawak?
A: Not at the moment. Our core expertise is in the state of Sarawak, and there are still so many opportunities here. Maybe we will be looking for opportunities beyond Sarawak at a later point of time, but not now. We are very keen to build a very strong foundation in the next economic growth cycle for the state. After that, we can take that expertise in profit generating and look outside.
Q: What does your financial service business comprise?
A: It comprises a 25 per cent shareholding in an independent investment bank and stock broking house in Kuala Lumpur, K&N Kenanga Holdings Berhad. It is one of the best established retail stock broking companies and an investment bank that is building its reputation fast in the market, having undergone a major revamp in the management which has resulted in large deals lately.
Q: Are you engaged in public-private partnerships with the Sarawak government in infrastructure projects?
A: Yes, we are, especially with the Sarawak Economic Development Corporation, with whom we have joint ventures in construction, road maintenance, property development, in quarrying, mining, and premix production. Traditionally, a lot of these services were provided by the Public Works Department of the government. But they decided to privatise the business and retain a stake to participate in the profits. The normal stake ratio in such a joint venture is 51 per cent for us and 49 per cent for the government. It’s a win-win situation because we are running the joint ventures efficiently and are driving the business. We even don’t charge management fees.
Q: Are you engaged in green or innovative technologies or in related research and development?
A: Yes, we have some modest seed investments in converting biomass into compost. We are also actively involved into providing new road services by using waste materials, and are looking for additives created from waste which we can include into cement. We have a partnership with Universiti Malaysia Sarawak for this kind of research. Another focus is on complying with all environmental standards, for example to secure that all our emissions are below the minimums. We don’t pollute the environment, we don’t bypass emission controls, we have implemented dust monitoring, and have just improved the whole cement distribution across the state by using more sealed systems.
Q: What would be your advice for investors who want to set up shop in Sarawak in the sectors you are covering? Is there room for growth?
A: A couple of tips: Engage with the relevant government agencies, like the State Planning Unit, the Regional Corridor Development Authority (RECODA), and the Malaysian Investment Development Authority (MIDA). They are very informative and very helpful. Another is: Do not be shy or reluctant to use local technical consultants. They have a lot of expertise, and if there are special requirements, a foreign consultant can partner with them. They are accustomed to collaborations. Also, don’t dismiss the local construction and engineering companies here and don’t bring all the workers from overseas. Investors coming to Sarawak should take the view that they are coming here to generate economic wealth for the state. Sarawak has an excellent workforce. However, with the accelerating economic growth they have to get appropriate training as early as possible. Also, if somebody invests here, he should not rule out to bring in a local co-investing partner, whether it is an institution or a private sector company like us. They have access to capital and the local knowledge, can enrich the investment, and keep it on track.
Q: Is there still room for growth in the sector?
A: Yes, there are still opportunities for primary investments into larger projects and plants. Investors should not only be looking at Samalaju, but also at Tanjung Manis and other industrial zones. Apart from the big factories, there are also great opportunities in the supporting light industry and for second-tier investments to fill in gaps. When producing aluminium, this could involve processing dust or waste, making downstream extrusions, or even making the pallettes that the companies need. There are a lot of opportunities which haven’t been addressed yet.
Q; What would be your summarised message to our readers?
A: Sarawak is one of Asia’s most exciting investment destinations for energy intensive industries. Don’t miss out!
[caption id="attachment_2863" align="alignleft" width="225" caption="Dato Richard Curtis, Group Managing Director of Cahya Mata Sarawak"][/caption] Cahya Mata Sarawak (CMS) is a major private-sector conglomerate in Sarawak. The portfolio of the Bursa Malaysia-listed enterprise spans over 40 companies involved in cement manufacturing, construction, trading, property development, financial services, education, and others. Inside Investor talked to Group Managing Director Dato Richard Curtis about the company’s development and the future plans. Q: You are running a conglomerate of over 40 companies. What sector is the biggest revenue contributor? A: The biggest revenue contributor is our cement division. We are running two cement plants, a...
Cahya Mata Sarawak (CMS) is a major private-sector conglomerate in Sarawak. The portfolio of the Bursa Malaysia-listed enterprise spans over 40 companies involved in cement manufacturing, construction, trading, property development, financial services, education, and others. Inside Investor talked to Group Managing Director Dato Richard Curtis about the company’s development and the future plans.
Q: You are running a conglomerate of over 40 companies. What sector is the biggest revenue contributor?
A: The biggest revenue contributor is our cement division. We are running two cement plants, a clinker plant, and also make concrete products. The second biggest contributor is our construction material sections, where we quarry stones and aggregates and manufacture premix.
Q: Are there any sectors you would like to add to your business?
A: Our future plans for growth have two focuses. The first is around our existing businesses. We want to grow in tandem with the economic growth of Sarawak, driven largely by SCORE, and maximise all the opportunities within the state. The other focus is that we wish to make strategic investments into SCORE projects. We already have made a major investment into OM Sarawak’s manganese smelter operations, having taken a 20 per cent stake. We are also the lead partner for the development of the township in Samalaju and are involved in providing workers’ camp services. Furthermore, we are looking actively for other strategic investments into SCORE projects where we could participate. We wish to be seen as a major local player that provides some involvement for the Sarawak private sector in these investments.
Q: Who stands behind CMS? Who are the major shareholders?
A: Members of the founding Taib family are the leading shareholders. In addition to that, we have major institutional investors which include the Employees Provident Fund, the Sarawak Economic Development Corporation, and other big institutions.
Q: How many people are working for CMS and where do you get all the qualified personnel from?
A: Currently we have 1,995 employees, with 95 per cent of them being Sarawakians. We have a strong policy of employing local people. The remaining five per cent are mostly West Malaysians, mixed with a few expatriates. One of the unique things about Sarawak is the low staff turnover, as people don’t like to change their jobs. This means we invest a lot into training our staff and into career planning for everyone. We have also instituted a management training programme, where we train young graduates, attach them to different business units, and see them as part of what we call the group’s talent pool. We know that the new generation of employees won’t be so loyal and conservative like the older generation, so we have to make sure that we are an employer of choice.
Q: Are you actively looking for project partners or foreign investors for specific businesses? Do you have any business relations to the GCC?
A: No, we are not. We are actually a company that gets approached by foreign investors who want to come to Sarawak, and we keep an eye open for them. We have a healthy balance sheet, a professional and independent management team, and we know the state well. When foreign investors come here looking for a local partner, they may come to us. Regarding the Middle East or the GCC, we don’t have any business relations at present. There had been talks with Middle Eastern companies, but so far nothing has been concluded.
Q: Do you have any expansion plans beyond Sarawak?
A: Not at the moment. Our core expertise is in the state of Sarawak, and there are still so many opportunities here. Maybe we will be looking for opportunities beyond Sarawak at a later point of time, but not now. We are very keen to build a very strong foundation in the next economic growth cycle for the state. After that, we can take that expertise in profit generating and look outside.
Q: What does your financial service business comprise?
A: It comprises a 25 per cent shareholding in an independent investment bank and stock broking house in Kuala Lumpur, K&N Kenanga Holdings Berhad. It is one of the best established retail stock broking companies and an investment bank that is building its reputation fast in the market, having undergone a major revamp in the management which has resulted in large deals lately.
Q: Are you engaged in public-private partnerships with the Sarawak government in infrastructure projects?
A: Yes, we are, especially with the Sarawak Economic Development Corporation, with whom we have joint ventures in construction, road maintenance, property development, in quarrying, mining, and premix production. Traditionally, a lot of these services were provided by the Public Works Department of the government. But they decided to privatise the business and retain a stake to participate in the profits. The normal stake ratio in such a joint venture is 51 per cent for us and 49 per cent for the government. It’s a win-win situation because we are running the joint ventures efficiently and are driving the business. We even don’t charge management fees.
Q: Are you engaged in green or innovative technologies or in related research and development?
A: Yes, we have some modest seed investments in converting biomass into compost. We are also actively involved into providing new road services by using waste materials, and are looking for additives created from waste which we can include into cement. We have a partnership with Universiti Malaysia Sarawak for this kind of research. Another focus is on complying with all environmental standards, for example to secure that all our emissions are below the minimums. We don’t pollute the environment, we don’t bypass emission controls, we have implemented dust monitoring, and have just improved the whole cement distribution across the state by using more sealed systems.
Q: What would be your advice for investors who want to set up shop in Sarawak in the sectors you are covering? Is there room for growth?
A: A couple of tips: Engage with the relevant government agencies, like the State Planning Unit, the Regional Corridor Development Authority (RECODA), and the Malaysian Investment Development Authority (MIDA). They are very informative and very helpful. Another is: Do not be shy or reluctant to use local technical consultants. They have a lot of expertise, and if there are special requirements, a foreign consultant can partner with them. They are accustomed to collaborations. Also, don’t dismiss the local construction and engineering companies here and don’t bring all the workers from overseas. Investors coming to Sarawak should take the view that they are coming here to generate economic wealth for the state. Sarawak has an excellent workforce. However, with the accelerating economic growth they have to get appropriate training as early as possible. Also, if somebody invests here, he should not rule out to bring in a local co-investing partner, whether it is an institution or a private sector company like us. They have access to capital and the local knowledge, can enrich the investment, and keep it on track.
Q: Is there still room for growth in the sector?
A: Yes, there are still opportunities for primary investments into larger projects and plants. Investors should not only be looking at Samalaju, but also at Tanjung Manis and other industrial zones. Apart from the big factories, there are also great opportunities in the supporting light industry and for second-tier investments to fill in gaps. When producing aluminium, this could involve processing dust or waste, making downstream extrusions, or even making the pallettes that the companies need. There are a lot of opportunities which haven’t been addressed yet.
Q; What would be your summarised message to our readers?
A: Sarawak is one of Asia’s most exciting investment destinations for energy intensive industries. Don’t miss out!
