Business

PANTECH Group Holdings Bhd has taken the Inland Revenue Board (IRB) of Malaysia to court, filing an application for judicial review at the High Court of Malaya over a RM6.76m capital gains tax assessment.

In a filing, the group said it is challenging the assessment relating to Capital Gains Tax (CGT) imposed for the year of assessment 2025, following a notice issued by the IRB in September 2025.

The dispute centres on the interpretation of Malaysia’s CGT regime on gains from unlisted shares and whether Pantech’s transactions fall under an exemption linked to initial public offerings (IPO) under the Income Tax (Initial Public Offering) (Exemption) Order 2024 [P.U.(A) 290/2024].

Pantech contends that its corporate restructuring activities qualify for the IPO-related exemption, while the IRB had rejected its appeal and maintained the tax assessment.

Following the rejection, the group on July 1, 2026 filed two applications at the High Court, for leave for judicial review of the IRB’s decision and for a stay of payment of the RM6.76 million tax bill pending disposal of the case.

The stay application, if granted, would suspend enforcement of the tax demand until the court determines the merits of the dispute.

Pantech said it does not expect the legal proceedings to have any material impact on its day-to-day operations or subsidiaries.

The High Court has yet to fix a hearing date for the matter. — TMR

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FAVELLE Favco Bhd has secured purchase orders and a letter of intent worth a combined RM504 million, driven partly by investments in artificial intelligence (AI)-related infrastructure.

In a Bursa Malaysia filing today, the group said its unit Favelle Favco Cranes (M) Sdn Bhd received the contracts between May 29 and July 2.

The orders comprise offshore crane supply contracts from Floating Production Solutions Sdn Bhd and Dialog E&C Sdn Bhd, both scheduled for delivery by the second quarter of 2027.

The group also secured a tower crane supply contract from Samsung C&T Corporation, with deliveries staggered from the end of 2026 to the second quarter of 2027.

Favelle Favco said a significant portion of the newly secured orders was driven by customer investments in AI-related infrastructure, positioning the group to benefit from the continued expansion of AI-led capital spending.

The contracts are expected to contribute positively to earnings and net assets for the financial year ending Dec 31, 2026 and beyond. — TMR

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MUDAJAYA Group Bhd said its unit, Mudajaya Corporation Bhd, has been served with a notice of arbitration by China Communications Construction (ECRL) Sdn Bhd over a payment dispute linked to the East Coast Rail Link (ECRL) project.

In a Bursa Malaysia filing today, Mudajaya said the notice, dated June 29, relates to works under Package 3 of the ECRL involving stations and ancillary buildings in Dungun, Kemasik and Chukai.

The dispute stems from an adjudication filed by Mudajaya Corporation in December 2025 under the Construction Industry Payment and Adjudication Act 2012 (CIPAA), seeking RM10.95 million in under-certified claims under Interim Payment Certificate No. 22.

On May 31, the adjudicator ruled in favour of Mudajaya Corporation, awarding RM7.77 million, together with interest, costs and expenses.

Following China Communications Construction’s failure to make payment, Mudajaya said its unit had filed an application to enforce the adjudication decision as a High Court judgment, with the matter fixed for further case management on July 29.

Under the arbitration, China Communications Construction is seeking a declaration that it is not obliged to pay the RM7.77 million adjudicated amount, and is also claiming RM22.75 million from Mudajaya Corporation for additional costs, losses, liquidated damages, management fees and interest.

Mudajaya said its unit denies liability and will appoint legal counsel to defend the claims, while pursuing counterclaims for monies allegedly due from China Communications Construction.

The group said, apart from the amount claimed and related legal costs, no further financial impact is expected at this stage. — TMR

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RESERVOIR Link Energy Bhd has secured a five-year panel appointment from Petroliam Nasional Bhd (Petronas) to provide integrated discovered resource assessment services under Package 2 for carbon capture, utilisation and storage (CCUS) and contaminant-related projects.

In a Bursa Malaysia filing today, the oil and gas services group said its 60%-owned unit, Reservoir Link Solutions Sdn Bhd (RLS), received the letter of appointment on May 14.

The contract runs until May 13, 2031, and covers work scopes including data consolidation and management, geological and geophysical evaluation, subsurface and surface development planning, economic analysis, as well as the preparation and submission of final reports.

Reservoir Link said the participating operating units under the appointment are Petronas and Petronas Carigali Sdn Bhd.

However, the group noted that the panel appointment does not guarantee any work orders, as jobs will be awarded via mini-bidding or direct award exercises throughout the tenure.

The appointment is expected to contribute positively to earnings for the financial year ending June 30, 2027, and over the duration of the contract as work orders are secured.

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The Kuantan plant now sits at the intersection of industrial policy, environmental governance and global supply-chain security 

by TMR 

LYNAS Rare Earths Ltd’s processing plant in Kuantan has become one of the most strategically important rare earths facilities outside China, anchoring the Australian group’s global supply chain as the US, Japan and other major economies seek secure alternative sources of critical minerals. 

Located in the Gebeng industrial estate, the plant processes rare earth concentrate from Lynas’ Mount Weld mine in Western Australia into materials used in electric vehicles (EVs), electronics, wind turbines, drones, missiles and fighter jets. For Malaysia, the facility is both a geopolitical asset and a continuing regulatory flashpoint, reflecting the growing importance and sensitivity, of rare earth processing. 

Outgoing Lynas CEO Amanda Lacaze, who stepped down at the end of June after 12 years at the helm, has presented the Malaysian operation as central to the company’s turnaround and its next phase of growth. In recent interviews with The Wall Street Journal (WSJ) and TIME, Lacaze’s comments placed Kuantan firmly at the centre of Lynas’ recovery, expansion and challenge to China’s dominance. 

“There is a reason why we’re not all that popular in China,” Lacaze told the reporters after visiting Lynas’ facilities in Malaysia. 

The remark captures the strategic weight now attached to the Kuantan plant. China still dominates much of the rare earths supply chain, especially in separation and magnet-making, and has tightened access to critical materials through export controls. Lynas, together with US-based MP Materials, is among the few non-China producers able to separate rare earths commercially and at a meaningful scale. 

Coming on Board 

When Lacaze took over Lynas in 2014, the Malaysian plant was far from the strategic platform it has since become. Lynas’ share price had lost more than 90% of its value over several years, its previous CEO had served only 14 months, and the Kuantan facility was still struggling with the technically demanding task of separating rare earth elements that are chemically similar. 

“We had these assets that didn’t work. So we weren’t actually generating any cash,” Lacaze said. 

Many expected Lynas to go the way of Molycorp Inc, the once-promising US rare earths champion that collapsed into bankruptcy in 2015. Molycorp owned the Mountain Pass mine in California, then the only operating rare earth mine in the US and had been seen in the early 2010s as the West’s best hope of challenging China’s dominance in the sector. 

Instead, Lacaze cut costs, reduced the executive ranks, shut offices outside the operating core, and relocated the remaining leadership team to Kuantan in 2014 to focus directly on fixing the plant. 

The turnaround began to show within months. Lynas said production quality had improved sharply, with the proportion meeting required standards rising to 99% from 48% not long before. 

“Lynas is here to stay,” Lacaze said at the time. 

That operational recovery in Malaysia became the foundation for Lynas’ broader revival. The company’s share price is now roughly 15 times higher than when Lacaze took over. Revenue for the three quarters ended March reached about US$470 million (RM1.9 billion), a 70% increase from the same period a year earlier. 

China Monopoly 

The Kuantan plant is also expected to take on a larger role in Lynas’ heavy rare earths strategy. In the interview conducted at the Kuantan processing plant, Lacaze said Lynas had broken China’s monopoly in separated light rare earths in 2013 and repeated that achievement in heavy rare earths in 2025. 

On future expansion, Lacaze said Lynas’ immediate priority was to lift production towards its existing annual nameplate capacity of 10,500 tonnes of neodymium- praseodymium or NdPr. In the 2025 financial year, Lynas produced 6,558 tonnes. 

The next step, she said, was “to put in the new heavy rare earths separation circuit here in Malaysia,” before the company considered further capacity increases. 

Heavy rare earths such as dysprosium and terbium are critical for high-performance permanent magnets used in EVs, aerospace and defence applications, particularly where magnets must withstand high temperatures. Their strategic value has increased as China tightens control over exports of selected rare earths and related technologies. 

Lynas said in May 2025 that Lynas Malaysia had commenced production of separated heavy rare earths at Kuantan, including dysprosium oxide. The company described itself as the only commercial producer of separated 

heavy rare-earth products outside China. In its half-year results for the period ended Dec 31, 2025, Lynas said it had completed its first half year of heavy rare earth production at Lynas Malaysia, secured initial customer contracts for separated heavy rare earth oxides, including dysprosium and terbium, and made product shipments to customers. 

Lacaze has also pointed to Malaysia’s industrial advantages. In the interview, she said one of the benefits of Lynas’ location in Malaysia was that it operated in a heavy industrial park with dependable gas, water and electricity supply, as well as access to reagents and nearby industrial partners. 

For rare-earth processing, those factors are crucial. The industry requires chemical separation expertise, reliable utilities, waste management systems, skilled personnel and a surrounding industrial ecosystem. Lynas’ public materials state that its Malaysian advanced materials plant occupies a 100ha site in Gebeng and has operated since 2012, supplying separated rare earth materials to customers in East Asia, the US and Europe. 

Yet the plant’s role in Malaysia remains contested. Since 2018, several Malaysian administrations have pressured Lynas over environmental and waste concerns. Lacaze maintained the company complied with regulatory requirements and was eventually allowed to keep operating.

She rejected suggestions that Lynas had an unresolved community problem. Lacaze said the company had strong local support and had never been involved in a public health, safety or environmental incident. 

Licence Renewed 

Malaysia renewed Lynas Malaysia’s operating licence for 10 years from March 3, 2026, giving the company greater investment certainty. The renewal, however, came with stricter waste-related conditions, including a requirement to stop producing radioactive waste by 2031 and to neutralise prior waste through thorium extraction or other approved methods. 

In a statement emailed to The Malaysian Reserve (TMR), Lynas refered to recent media articles regarding an environmental impact assessment (EIA) report for a proposed expansion of its operations in Malaysia. It said the company’s EIA report has undergone a technical review in accordance with the Malaysian regulatory assessment process. The Malaysian Department of Environment has requested that Lynas submit an updated EIA following that technical review process. Lynas will submit an updated EIA as requested, it added. 

Lynas has also built a cracking-and-leaching facility in Kalgoorlie, Western Australia, a move Lacaze described to reporters as a backup after years of regulatory pressure in Malaysia. Still, her recent comments suggest Malaysia remains central to Lynas’ cost structure and operating model. 

It was reported that Lynas walked away from a proposed US$258 million Pentagon-backed rare earth processing facility in Texas after Lacaze concluded that the plant was unlikely to match the cost efficiency of Lynas’ Malaysian operations. 

That comparison underlines Kuantan’s significance. Even as Western governments push to localise critical minerals supply chains, Malaysia remains one of the few places where large-scale rare earth separation outside China is already operating commercially. 

For Malaysia, the Kuantan plant now sits at the intersection of industrial policy, environmental governance and global supply-chain security. Lacaze’s final remarks as Lynas CEO suggest that the facility is no longer just an Australian company’s overseas processing site, but a strategic industrial platform whose importance is growing as the world searches for rare earths supply outside China. 

• This article first appeared in The Malaysian Reserve weekly print edition 

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CITAGLOBAL Bhd has decided not to proceed with its proposed renewable energy collaboration in Kyrgyzstan after completing feasibility studies and a broader evaluation of the project.

The group said the memorandum of understanding (MoU), signed on June 25 last year with the Ministry of Energy of the Kyrgyz Republic, has expired in accordance with its terms and will not be extended.

The MoU had marked Citaglobal’s planned entry into renewable energy projects in Kyrgyzstan, including potential collaboration on the construction of renewable energy facilities, following discussions with Kyrgyz officials during a visit by President Sadyr Zhaparov to Malaysia.

At the time of signing, Citaglobal described the initiative as aligning with its strategy to expand its energy segment and international footprint, particularly as Kyrgyzstan positions itself as a regional clean energy hub.

The company said the lapse of the MoU is not expected to have any material financial impact on its earnings, net assets or gearing for the financial year ended June 30, 2026. –TMR

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EC Excel Holdings Bhd is proposing to acquire a 10,732 sq m freehold land in Seremban, Negeri Sembilan, for RM10.17 million as part of its expansion strategy.

In a Bursa Malaysia filing, the company said the land will be used to construct a warehouse to support its operational requirements and future growth plans.

EC Excel said the acquisition is expected to increase storage capacity, improve operational efficiency, and provide additional space for expansion.

The group added that the proposed acquisition aligns with its long-term business strategy by providing a strategic site for warehouse development.

It said the board is confident the project will contribute positively to future operations, although it is not expected to have a material impact on earnings or earnings per share for the financial year ending Dec 31, 2026. –TMR

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SAPURA Industrial Bhd is disposing of 40,964 sq m of leasehold industrial land in Bandar Baru Bangi for RM42.33 million in cash, with proceeds earmarked for expansion of its automotive manufacturing operations and acquisition of new industrial land.

In a bourse filing today, the company said it had entered into a sale and purchase agreement with Zeito Plastic Components Sdn Bhd for the disposal of the land, which has a lease expiring in July 2103.

The property is currently classified as vacant industrial land, although parts are leased out and generate rental income.

Sapura Industrial said the disposal price represents a 4.3% premium over its independent valuation of RM40.6 million as at April 30 and is significantly higher than its net book value of RM9.1 million as at Jan 31.

The group expects to recognise a one-off net gain of RM29.14 million after transaction costs and real property gains tax.

Based on pro forma figures, the transaction will lift net assets per share to RM2.05 from RM1.65 and reduce gearing to 0.32 times from 0.40 times.

Proceeds will be used mainly to expand its automotive manufacturing, machining and assembly operations, including stabiliser bars, coil springs and brake discs, through the purchase of new high-precision equipment.

A further RM12 million has been allocated to acquire land or properties for new plants closer to customers, while RM3.11 million will be used for working capital. The balance will cover disposal-related expenses.

Sapura Industrial said the move allows it to unlock value from non-core assets held for more than 20 years and redeploy capital into higher-return activities, while improving operational proximity to customers. –TMR

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KHAZANAH Nasional Bhd has welcomed the Parliamentary Public Accounts Committee’s (PAC) recommendations for stronger oversight of Malaysia Airports Holdings Bhd (MAHB) following its privatisation, saying many of the measures are already being implemented.

The PAC, in a report released on Wednesday after 19 proceedings and a site visit to KLIA Terminal 1, said MAHB should remain under close scrutiny given that airports are strategic national assets.

Its inquiry focused on KLIA’s operational performance, transformation efforts and delays involving key infrastructure such as the Aerotrain and baggage handling system.

Among its recommendations, the bipartisan committee called for MAHB to publish regular operational and service performance reports based on clear key performance indicators (KPIs), and submit progress and financial updates on major projects to the Ministry of Finance, Ministry of Transport, the Civil Aviation Authority of Malaysia and the PAC.

Responding to the report, Khazanah said the recommendations reinforce the broader objectives behind MAHB’s privatisation, which was aimed at strengthening Malaysia’s aviation sector through improved connectivity, better passenger experience and stronger airport competitiveness.

Khazanah MD Amirul Feisal Wan Zahir said taking MAHB private was about creating the conditions for long-term transformation by enabling sustained investment, operational excellence and continuous improvement.

“The task ahead for MAHB is significant and lasting transformation will take time. We are encouraged by MAHB’s commitment to learn from global best practices and leverage international expertise, while pursuing continuous improvement with discipline and consistency,” he said.

The PAC had also highlighted that years of underinvestment, delayed corrective action and insufficient maintenance had contributed to service quality issues at major airports, including the Aerotrain upgrade, completed in July 2025, which continues to face operational disruptions.

Khazanah said MAHB continues to operate within an established governance and regulatory framework, adding that it supports enhanced reporting structures and high standards in procurement, project delivery, performance tracking and integrity.

It also stressed that while MAHB operates the airport network, national security, border control and sovereign functions remain under the purview of relevant government agencies. –TMR

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FRASERS Group plc has agreed to sell its entire stake in Sports Direct Malaysia to PT MAP Aktif Adiperkasa Tbk (MAP Active) for about US$150 million while entering a long-term agreement that will see the Indonesian retailer operate and develop Sports Direct in Malaysia and pay Frasers Group ongoing income.

The deal marks Frasers Group’s exit from direct ownership of its Malaysian sports retail operations, but not from the market, according to reports.

Under the arrangement, MAP Active will take over the business and use its local retail infrastructure, operating expertise and brand portfolio to expand the Sports Direct footprint in Malaysia.

Sports Direct is a major sports and fitness retailer, selling footwear, clothing and equipment. Frasers Group, which began as a single store in Maidenhead in 1982, and in 2019 saw the rebrand of Sports Direct International to Frasers Group.

The disposal deepens Frasers Group’s existing partnership with MAP Active, which already covers Indonesia, the Philippines, Thailand, Vietnam and Cambodia. The companies said the expanded relationship supports their wider Southeast Asian strategy to streamline operations, unlock efficiencies and accelerate growth across the region, reports Investing.Com.

Frasers Group and MAP Active are targeting more than 350 stores over the long term, with an ambition to serve more than 600 million consumers across the region. The companies said MAP Active’s established network and portfolio of distributed brands would help bring global sport and lifestyle brands to a wider customer base.

“MAP Active is a valued strategic partner, and this transaction further deepens our relationship,” the report quoted Frasers Group CEO Michael Murray, adding that the partnership would create “a strong platform” for the group’s growth plans. — TMR

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