George Kent hot on acquisition trail

George Kent hot on acquisition trail
By Presenna Nambiar
Published: 2009/07/15

George Kent (Malaysia) Bhd (3204), which makes water meters and brass components, is aggressively looking for acquisition targets to grow its meter and contract divisions.

In addition to regional markets like Vietnam, Singapore and China, it is looking at Europe.

George Kent chairman Tan Sri Tan Kay Hock said it was looking for companies which can complement its manufacturing facilities, add to its range of water meters or are original equipment manufacturers (OEMs).

"We want to buy something soon because if the market starts to recover good assets will no longer be cheap," he said.

Tan said teams have been sent out to scout for potential targets, with the latest one just back from Singapore.
Depending on the size of the acquisition, the company would even be willing to go back to its shareholders to raise funds if required.

George Kent has about RM27 million in cash.

"The important thing is getting the right target. We are not afraid of the size," Tan told reporters in Kuala Lumpur yesterday.

Besides sales of its own water meters, 40 per cent of revenue comes from being OEM suppliers to "friendly" competitors.

As part of its transformation initiative launched some two and a half years back, George Kent plans to further develop its general civil and structural engineering expertise to enable it to take up more turnkey contractor and project manager jobs.

The key areas of focus will be in infrastructure works related to water and waste water, healthcare and hospital facilities.

The contract division is expected to contribute between 30 and 40 per cent revenue in the next five years.

George Kent is bidding for several projects under the Tenth Malaysia Plan, including the Pahang-Selangor raw water transfer scheme - package 3A: Semantan river intake and pumping station, the Langat II water treatment plants, new hospital upgrading and extension projects, and several other water infrastructure projects in Peninsular Malaysia.

It won its first job as a turnkey contractor in February this year for the 106-bed facility at Hospital Kuala Lipis, Pahang.

"The future prospects for George Kent will be bright. The strategic plan we have in place will not deliver instant results, but we are building the foundation for long-term growth of the group," Tan said.

- Bussiness Times