Discover more from The Coffee Break
☕️ Tajuddin reveals: move to unseat Zahid Hamidi as UMNO President in May 2020, UMNO MPs SD backing Anwar Ibrahim as PM is real
Malaysia's inflation without subsidies: 11.4%. Sapura Energy back to black. Taman Sri Muda residents suing govt over December floods. G7 nations unveiled USD600 bil funding to counter's China's BRI.
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1. MARKET SUMMARY
2. NUMBERS AT A GLANCE
Malaysia’s inflation rate could have reached 11.4% in May (the actual rate is 2.8%) if the government did not provide any subsidies, according to the Minister in the Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed.
466 hours — the number of hours Reddit moderators (who are volunteers) work daily in 2020, based on the logs of those moderators who participated in the study by Hanlin Li at Northwestern University in Evanston, Illinois. Based on the gig work website UpWork, content moderators are paid about USD20 an hour, which means the moderators of Reddit provided USD3.4 mil of unpaid labour to keep the internet platform relatively free from unsavoury content!
98kg — the weight of the largest python ever found in Florida. The 5 meter female Burmese python was caught after researchers used a male “scout” to find her.
3. IN MALAYSIA 🇲🇾
After Tajuddin Abdul Rahman was dropped from the UMNO supreme council last week, he went to hold a press conference to ‘spill the tea’. In the press conference, he mentioned that:
The move to unseat Zahid Hamidi, the UMNO president, started in May 2020 in a discussion involving top leaders such as Najib Razak and UMNO deputy president Tok Mat. However, the move was unsuccessful due to some leaders getting cold feet.
He had also claimed some UMNO leaders also signed the statutory declaration backing Anwar Ibrahim as the next prime minister, on the insistence of Zahid Hamidi. Padang Rengas UMNO MP Nazri Aziz admits to signing this SD to support AI.
In Lim Guan Eng’s undersea tunnel corruption trial, a former employee of the company involved in the bribery, Azli Adam, told the court that Zarul Ahmad, one of the directors of the same company, confessed to him that he falsified payment vouchers and invoices to cover the bribes given to Lim. Previously, Zarul testified he gave Lim a total of RM3.3 million on several occasions from 2013 to 2017.
Sapura Energy is in the black, recording a net profit to the tune of RM91.93 mil, backed by gains from the appreciation of the US Dollar against the Ringgit. According to the company’s CEO, the company is recovering following the implementation of its reset plan. It looks like they do not need Petronas’ help after all.
According to the transport minister, Wee Ka Siong, the government has received a notification from Adil Permata, one of the companies involved in the RTS Link, that a ‘white knight’ is taking over the company. It is rumoured that Tan Sri Lim Kang Hoo of Ekovest is the ‘white knight’.
A white knight is a hostile takeover defence whereby a ‘friendly’ individual or company acquires a corporation at fair consideration when it is on the verge of being taken over by an ‘unfriendly’ bidder or acquirer.
The iron lady of Malaysia, Rafidah Aziz, had resigned as the chairman of Air Asia X, after serving the company for more than a decade. In a separate announcement, Air Asia X has appointed Tunku Mahmood Fawzy as an independent and non-executive director. Tunku Mahmood is currently the chairman of Deutsche Bank (M) Bhd and Hong Leong MSIG Takaful Bhd.
NAZA Communications Sdn Bhd, a wholly-owned subsidiary of the diversified Naza Corp Holdings Sdn Bhd, is looking to buy the assets of digital services provider U Mobile Sdn Bhd (partly owned by Sultan Johor and Berjaya’s Vincent Tan), according to The Edge Malaysia. If the asset acquisition goes through, Naza will join the big boys in the telco industry. Back in August 2020, there was speculation that U Mobile would be listed on Bursa Malaysia. However, the plans seem to have been shelved.
50 residents of Taman Sri Muda are suing the government and nine others for RM3.7 mil in damages incurred in last December’s massive floods. Among the demands of the residents is that they want the court to declare that the relevant authorities have failed to prevent the avoidable and devastating floods from happening.
4. AROUND THE WORLD 🌎
G7 meeting — of Russia and China:
The G7 nations, comprising nearly half of the world’s economic output, discussed on possible price cap on Russian oil. How? It would leverage its global dominance in shopping and insurance services by restricting availability to them unless Russian oil importers observe the price caps.
The group vowed to stand with Ukraine “for as long as it takes” and to continue to “provide financial, humanitarian, military and diplomatic support” in a statement.
The group pledged to raise USD600 bil in private and public funds to finance infrastructure projects in developing countries to counter China’s multitrillion-dollar Belt and Road Initiative (BRI).
Takeaway — the western hegemony is feeling the threat from the rising powers in the east.
Russia has defaulted on its foreign debt for the first time since 1918 as it missed its deadline to pay a USD100 mil in dollar and euro-denominated interests. However, this is less about Russia’s financial capacity to fulfil its obligations (its financials are healthy with soaring oil prices) and more due to sanctions blocking it from making international payments. Russia has sent the payment in rubles, but the bonds’ covenants do not allow payment in rubles.
Russian Finance Minister has called this default a “farce”. This default will have a limited impact on the global financial system as Russia’s foreign debts are low at around USD39 bil (17% of GDP). For comparison, Greece defaulted USD277.5 bil in sovereign debt in 2012.
Leonardo del Vecchio, the billionaire Italian entrepreneur and owner of EssilorLuxottica, passed away at 87. A true rags-to-riches story, he was sent to an orphanage at seven as his mother was unable to care for him and he worked as an apprentice to a tool and dye manufacturer in Milan at 14.
According to Forbes, his net worth is estimated at USD27.3 bil. His company is the market leader in eyewear, controlling 80% of the market. The company owns Rayban (acquired in 1999 for USD640 mil) and Oakley (acquired in 2007 for USD2.1 bil) and pretty much manufactures eyewear for most brands, hence the monopoly.
Most would know SoftBank’s killer investment in Alibaba. Naspers Ltd, a South African-based company through its Dutch-based subsidiary Prosus has also found a similar gold pot in investing in Alibaba’s closest competitor — Tencent. Prosus is the single largest shareholder in Tencent with a 28.9% stake worth USD134 bil. Prosus announced that it will be selling Tencent shares to reinvest in its own share buyback programme, reversing its earlier pledge to hold onto its Tencent’s shares.
Prosus also owns stakes in food delivery giant Delivery Hero of Germany, iFood of Brazil, Swiggy of India and other tech cos like Stack Overflow and Codecademy. The share buyback programme is to unlock value in its shares that has long been traded at a discount to its underlying assets. Its market cap currently stands at USD127 bil, slightly lower than its Tencent stake. This means the rest of the company’s assets and businesses are valued at less than zero.
Sex sells. Nastsassia Nasko was inspired to fundraise for Ukraine’s troops or Territorial Defense by selling nudes, inspired by OnlyFans. The site called TerOnlyFans (Ter stands for Territorial Defense) came about after she posted for help on Twitter to help evacuate a friend out of Ukraine but received no response until she half-jokingly offered to send a nude picture of herself and, within minutes received 10 responses.
Since its launch in March, the site has raised USD700k with 35 women and three men who volunteered to send pictures to donors.
5. FOR YOUR EYES 👁👁
KIA unveils its Europe Car of The Year and maiden electric car EV6, starting at RM300,688. Driving range of 506km per full charge, 0 to 100 km/h in 5.2 sec. Looks good — giving Tesla a run for its money!
A hand-sketched of the Leaning Tower of Teluk Intan
Have you ever seen a 14-string guitar?