This article first appeared in The Edge Malaysia Weekly on December 11, 2023 - December 17, 2023

MMC Corp Bhd, which is controlled by Tan Sri Syed Mokhtar Al-Bukhary, is looking to sell a stake in its port business, MMC Port Holdings Sdn Bhd (MMCPH), to an international private equity (PE) infrastructure fund.

According to sources, MMC Corp may sell up to a 49% stake in MMCPH but the price was undetermined at press time. Reuters had reported earlier that Syed Mokhtar could be looking to value the country’s largest port operator at more than RM12 billion.

It is understood that the PE fund is in the process of getting approval to start due diligence on MMCPH and its subsidiaries.

According to its website, MMCPH has seven ports in Malaysia: Port of Tanjung Pelepas, Johor Port, Northport, Penang Port, Tanjung Bruas Port, SPT Services and Andaman Port — all located along the Strait of Malacca, one of the world’s busiest shipping lanes.

A source says US-based Global Infrastructure Partners (GIP), with US$100 billion (RM466.5 billion) in assets under management, could be the fund interested in taking a stake in MMCPH.

“The fund would also need to share its due diligence findings with the government,” another source says.

It is unclear whether due diligence has already started, but it is understood that a group of GIP executives were in Kuala Lumpur two weeks ago.

Meanwhile, another source says the stake sale will not be a divestment by Syed Mokhtar in the port business as MMC is expected to maintain its controlling stake in MMCPH, by virtue of its 51% interest in the company. The stake sale could be a precursor to the potential listing of MMCPH. Note that MMC Corp was privatised in September 2021, a deal that cost Syed Mokhtar RM2.9 billion.

Back then, certain quarters suggested that the privatisation of MMC was to pave the way for the listing of its port business — which has been talked about since 2017, and resurfaced in 2018 and 2019, but nothing concrete materialised.

If the deal materialises, it will not be the first time GIP is investing in a Malaysian company. In August, it was reported that GIP is financing Yinson Holdings Bhd’s floating, production, storage and offshore (FPSO) asset Maria Quiteria in Brazil via a US$230 million term loan facility.

GIP is no stranger to the port business, having invested in the UK’s Peel Ports, Australia’s Port of Brisbane and Port of Melbourne as well as Peru’s port infrastructure platform Trabajos Maritimos (Tramarsa). 

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