Reported in The Star (1/11/06) there is a massive corporate restructuring in POS Malaysia & Services Holdings Bhd (PSH) where it involved:

• return cash of RM1.50 per share to shareholders and
• transfer its business, assets and listing status to wholly-owned Unit Pos Malaysia Bhd.

According to PSH chairman Tan Sri Adam Kadir, the rationale for the proposal is as follows:

• to allow shareholders to have direct exposure to the operating company and enable the group to grow further;

• to  treat all shareholders equally and is consistent with the aspiration of the group to maximise and realise value to its shareholders by unlocking value of the group by returning surplus cash to the shareholders;

However, what seems interesting is that since Jun’06, Khazanah Nasional Bhd, PSH’s single largest shareholder with a direct 30.2 per cent stake has been accumulating Pos’s shares from 17.6 per cent in June to its current level. Shares of PSH have risen 23 per cent this year.
From this corporate exercise, it seemed like Khazanah made good capital gains and cash returns from the repayment of RM1.50 per share to the shareholders. Well, first hand information is critical to the success of investment – don’t you think so?
However for PSH, this would have meant that 87 per cent of its RM899 million cash  has been mopped up which could have been used for future expansion plan
Incidentally, PSH director Datuk Abdul Majid Hussein resigned from the board yesterday.