KUALA LUMPUR: Sime Darby Bhd and UMW Holdings Bhd said separately yesterday that there are no plans to merge their respective motor divisions.

The two entities said this following a report in The Edge Malaysia weekly, which indicated that Permodalan Nasional Bhd (PNB) planned to merge Sime Darby’s motor division with UMW’s. PNB is the common controlling shareholder of both Sime Darby and UMW, with stakes of more than 50% each in both diversified entities.

The weekly quoted a source as saying: “Instead of listing Sime Darby Motors as a separate company, PNB has plans to merge the motor division with UMW Holdings. This will create a massive motor company under PNB’s roof.”

UMW said there are no such merger plans on the table and that it is focusing on executing its exit from the oil and gas (O&G) sector.

“On Jan 19, 2017, UMW announced its plans to exit the O&G sector. The exit from O&G is done through distribution in specie of all its shares in UMW Oil & Gas Corp Bhd to all entitled shareholders of UMW. This distribution exercise will be followed by a progressive exit of non-listed O&G assets held by UMW. The group is currently focusing on executing the announced initiatives as per the stated timeline,” UMW added.

Similarly, Sime Darby said in a statement that it is “untrue that a merger of the automotive businesses of the two companies is on the cards”, adding that its main focus currently is to create three independent listed companies on Bursa Malaysia, as it had previously announced.

“Sime Darby Motors is the second-largest BMW dealer in the world and a major player in the automotive industry in the Asia-Pacific region. Corporate exercises undertaken by Sime Darby Motors take into account the best interest of all our stakeholders, including shareholders and principals,” it added.

According to UMW’s website, its businesses include automotive component manufacturing and heavy equipment distribution. UMW, which distributes Toyota cars in Malaysia, also owns 38% of Perusahaan Otomobil Kedua Sdn Bhd.

Meanwhile, Sime Darby’s businesses include oil palm plantation and property development. Its automotive dealerships include names like BMW, Rolls-Royce and Mitsubishi.