Sime Darby (SD) says its acquisition of Permodalan Nasional’s (PNB) 61.2% stake in UMW Holdings for RM3.57 billion in cash will allow it to scale up and strengthen its presence in the Malaysian automotive sector.
The conglomerate said the move, which will add high-volume mass-market brands Toyota and Perodua to its portfolio, will allow it to scale up its operations in Malaysia, balancing any geopolitical risks in the region from its two key markets, namely China and Australia.
Its group CEO, Datuk Jeffri Salim Davidson, told Bernama the acquisition will complement SD’s existing automotive portfolio. Its Sime Darby Motors (SDM) division is a major player in the industry as a franchise holder for brands ranging from Porsche to BYD.
“UMW is already a dominant automotive player with a 52% share of the local market, and the exercise is expected to bring the share up to 55%. The enlarged entity will create greater value for all our stakeholders and allow us, as a Malaysian multi-national company, to play a better role in growing the national automotive industry,” he told the national news agency.
He added that the acquisition of the stake in UMW will provide SD with access to Toyota’s ecosystem, creating fresh opportunities for the group to grow in new geographies. The move will also strengthen the group’s traction in segments such as used cars, aftersales and assembly, due to the large volumes that it will command.
“Besides broadening our earnings base, our presence in other parts of the value chain creates resilience against changing retail models,” he said. As for Perodua, Jeffri said the automaker holds a dominant market share in the local automotive industry and as such, is the largest value component in the transaction.
He added that the acquisition will also bring Toyota Forklifts into SD’s portfolio, allowing it to move into a high-growth material handling business, which is presently being fuelled by the e-commerce boom. “Materials handling will add another dimension to our industrial division, to complement our mining and construction exposure,” he said.
Jeffri said the group will undertake a thorough review of UMW’s portfolio of brands to assess the compatibility against its existing portfolio, ensuring that SD continuously maintains a strong spectrum of products and services to enhance value for its shareholders.
“One of the first steps in our post-acquisition integration plan focuses on a seamless transition and integration, while leveraging the strengths of both companies and all the brands within,” he said.
He said the post-acquisition integration would have minimal operational disruptions, as the group is committed to maintaining the integrity of Sime Darby and UMW and capitalising on synergies. “We care deeply about our commitment to all principals. We will manage each brand separately and continue to build on the excellent work with our enterprising spirit and forward-thinking mindset,” he explained.
On the topic of workforce and equity participation, Jeffri said that given that PNB remains a significant shareholder of Sime Darby, the Bumiputera interest in the businesses will remain intact. “Additionally, the vendor and supplier ecosystem for Toyota and Perodua will remain and there are Bumiputera equity requirements to ensure Bumiputera participation along the value chain,” he said.
As for the funding of the acquisition, Jeffri said it will be funded primarily by bank borrowings and internal funds, which will see the strategic disposal of non-core assets for this purpose. Once the agreement becomes unconditional, he said SD will be making a general offer to acquire the remaining 38.8% stake in UMW, with the aim of delisting UMW from Bursa Malaysia. He said that the group expects to complete the takeover by end-February 2024.
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Price will getting higher
Quality, specification and aftersales will getting bad
Just like hyundai
It won’t be bad when selling new vehicles just like Chery and BYD sells good specs with good engines and also come with better aftersales and better quality
wondering why Sime Darby didn’t wanna buy Proton, hmmm
All brands Sime Darby carry
All premium priced one
Order P2 now or never
And also give affordable price including Toyota mostly unlike UMW
more baseless comments from the average troll on PT.
Hyundai’s quality in the past few years is actually pretty good in my experience – how do you reckon they’re selling so well in US and Europe? The eGMP models even won COTY back to back.
dealer customer service and manufacturer quality are two very different things.
no need to look far. down south in Singapore, which is a first world country, people have been buying hyundais and kias in big numebrs (mostly youngsters). You also can spot plenty of COE Hyundai and Kias around on our roads
Hyundais and kias have engine fire issues in the US and their dct transmission fitted to awd suv’s are hopeless when going off road as it gets overheated.
you do realise the same can be said for almost any other manufacturer – they’ve all had some problem of sorts at some point in time.
even trusty toyota
ahh..the simple-minded singular mindset individual. yes only they have had problems in the history of time. every other brand has been fine.
oh wait, Ford’s ecoboost fire issues, VW’s dsg, Peugeot’s rusting, BYD’s fire issues..Toyota has been PERFECT though – wait a minute..they recalled nearly 6 million cars for fuel pumps that suddenly failed causing the engine to stall while driving.
let me think…the BICYCLE! that’s the vehicle of choice for you. no issues there.
no wonder they’re selling so well – because their cars are bad. good logic.
aiya – you like jepunis car then you buy jepunis car lor…no need to troll here and there wan.
Hyundai-Kia group sales so good globally…you think so many customer stupid meh. not the same as 20-30 years ago you know – orang ada kemajuan.
i want to meet the person who actually takes their SUV offroad. any CRV AWD owners? 4-Matic boys? any XDrive folks? Land Rovers were made for off-roading – you guys MUST be taking your RM800K Land Rovers offroad…no? okay then.
actually my experience with SD has been way better than UMW…not perfect, but still better at least.
happy hyundai owner here – nothing to complain. ppl who make these comments not customers maybe?
the build quality of my Ioniq 5 is really good – much better fit and finish than most brands (and this is coming from an ex-W205 owner)
nice quality of material and no random rattles or squeaks. but build quality not related to local dealer also – so what are you talking about actually?
same here..i’ve had a pretty good experience with my 8th Gen Sonata actually
I disagree. After Sime Darby tookover UMW, aftersales should be good and better quality
Besides, also bring more toyota international cars to assemble here like Aqua, Voxy, Noah, Land Cruiser, Crown, Bz4X, Sienta, Mirai etc, & time to assemble RAV4, Camry, Corolla, Innova and all toyota models and also come with good engines like Dynamic Force Engines, Hybrid, Turbo engines with better specs but more affordable and cheaper
Asking for so many models like our market is so big lol
SD cybertroopers invaded this thread already. Can clearly see from their grammar
P2 were doing so well because the Japanese were managing them from top. Now, with locals sitting above them all, it would be interesting to see. We will see if karipap and kuih talam will be served in meeting from now on.
Gomen putting more taxpayers money into this fake national car brand that has never created their own designed car from scratch. Our wallets getting tighter but this gomen keep spending like water.
because the government is a lot more knowledgeable compared to you to know that perodua actually design DNGA-based cars alongside toyota while daihatsu work their magic with compact packaging. Keep degrading your own product and cry when Malaysia fall. hey, it’s the product of your own hands. be proud and blame government always!
If malaysia fails it is because of pakatan. And looking at SD performance so far (JLR anyone?) they are bound to fail. Pakatan is primed to fail.
If a lot of people have lost their jobs due to this business deal due to the usual corporate excuses like redundancy, there’s good reason to grumble about it. But if not, we should just continue to focus on our work.
Sime Darby
1. BMW
2. BYD
3. Ford
4. Hyundai/Inokom
5. Jaguar
6. Land Rover
7. Mini
8. Porsche
9. Volvo
UMW
1. Daihatsu
2. Hino
3. Lexus
4. Perodua
5. Toyota
DRB
1. Honda
2. Isuzu
3. Lotus
4. Mitsubishi
5. Proton
6. Smart
7. Tata
TAN CHONG
1. JAC
2. Nissan
3. Renault
4. Subaru
BERJAYA
1. Kia
2. Mazda
3. Citroen
4. Peugeot
NAZA
1. Maserati
2. Suzuki
Others:
1. CAM
2. CAMC
3. Chana
4. Chery
5. DFAC
6. DFSK
7. Foday
8. Foton
9. Foton Auman
10. JMC
11. King Long
12. Man
13. Mercedes Benz
14. Mitsubishi Fuso
15. Sinotruk
16. Scania
17. Tesla
18. UD Trucks
19. Volkswagen
20. Volvo Truck
21. Yangtse
22. ZNA
Thumbs up bro
Audi?
Seems like my former employer Sime Darby,menguasai pasaran automotive kaw kaw.
With so many cash cows,time for prices to come down a bit as “MADANI RAHMAT AUTOMOTIVE INSENTIF”….YAB ANWAR,kindly memantau.
Audi and Volkswagen under DRB
Not anymore. They’re just a dealer now.
I smell monopoly & price fixing coming, since both Toyota & Perodua is very popular in Malaysia taking in 50~60% of the market share.
Since when Sime Darby will do price fixing, any news or just assumption
Terbaik. Sime Darby should be better than UMW
Aiyoo,how to get consistent PNB’s unit trust dividend after this. But if it is fruitful this year,the like of ASN, ASM can expect a bumper dividend for 2023.
In the end, still is a government-owned company aka owned by PNB.
Giving the share to Sime Darby aka “son” of PNB means they messed up and passed it to Sime Darby since they have Sime Darby Motor.
“Delisting UMW from Bursa Malaysia”? meaning they are not doing well. Let’s see their price;
Today: 4.6 compared to early 2022: 2.9+, not too bad.
But early 2020: 4.5+ and early 2019: 5.5+. It seems like they going back to pre-covid level. Or Maybe PNB wants to bail out before things go south.
PNB, including PNB controlled maybank invested too much into sapura energy.was it RM4 billion? Now they need to cover up that loss or investors wont get any dividend. My opinion.
Interesting POV
Good move. Now, bring more toyota international cars to assemble here like Aqua, Voxy, Noah, Land Cruiser, Crown, Bz4X, Sienta, Mirai etc, & time to assemble RAV4, Camry, Corolla, Innova and all toyota models and also come with good engines like Dynamic Force Engines, Hybrid, Turbo engines with better specs but more affordable and cheaper
Wow, this is MASSIVE news. Cannot understate the significance here. Possibly even more significant than Proton-Geely JV a few years back.
If my memory serves right, this is only the second time Perodua experienced a major corporate shift. Their first was around two decades ago, when Daihatsu took majority control of their manufacturing arm (which worked out very well for UMW Toyota CKD ops). Perodua’s stakeholders however never changed since day one, iirc.
For Toyota, this is yet another big shift, but unlike the last one (four decades back, when UMW took over Toyota franchise from Inchcape), this time the transition appears to be ‘softer’, even though the stakes are much higher (Toyota has two assembly plants here now). Then again, Toyota’s (management in Japan) leverage in UMW has reduced over the decades, as Toyota’s (mgmt in Malaysia) has become increasingly reliant on Perodua (and by extension, Daihatsu). After all, the engines and gearboxes in many CKD Toyota models are supplied by Perodua-Daihatsu, local-market Rush and Veloz are built by Perodua, Axia development was led by Perodua, and Vios development involved Perodua… basically, Perodua has become deeply integrated in Toyota/Daihatsu’s ASEAN ops, and balancing this equation is the main priority.
So even if Toyota (mgmt in Japan) is worried about a brewing internal conflict of interest between their upcoming EVs and the existing BYD and Hyundai EVs on sale by Sime Darby… they might be willing to compromise for the sake of the ‘bigger picture’.
Personally, I think the most likely USP for UMW Toyota in Sime Darby’s umbrella is ‘ICE and hybrid’, for BYD is ‘mass-market EV’, and for Hyundai is ‘premium EV’. The others (BMW, Ford, Porsche etc.) should be able to coexist with UMW’s portfolio (yes, even Lexus will be fine, since average Lexus buyers won’t buy those Continental moneypits anyway).
Still, I worry that too much consolidation will be bad for the average rakyat, because it will lead to even bigger monopolies and lesser options, since many competitors will also consolidate or exit the market outright. Economies of scale is a major part of the auto industry. Get big or die trying. Anyway, DRB-HICOM is now under a lot of pressure, because they will need to fight Sime Darby’s three-pronged assault with Toyota (good luck Honda Malaysia), Perodua (gl Proton) and BYD (and gl Smart).
But overall I am still cautiously optimistic for this news. Let’s see how things will play out for everyone involved. The past 3 years have been a rollercoaster ride. Eventually things will need to calm down. See y’all on the other side.
1.Toyota has a 50-50 JV with BYD in EV R&D.
2.Toyota Supra is basically a debadged BMW Z4.
So it make sense, and also make cents and dollar for SD.
SD has got nothing to do with dollar but anyways, with Sime Darby, it might not use dollar. Anyways, since de-dollarisation is coming soon to malaysia
Make sure there will be some consolidation between SD & UMW. Sharing resources, capacity, manpower reduction, etc etc. the saving should be returned back to the rakyat. PNB money is from tax payer money. Myvi should be cheaper than current price. Other models as well. If not, seller is laughing to the bank with the expense of tax payer money.
Any vehicles above 20yrs must scrap. Too many bc bruk.