KUALA LUMPUR: PublicInvest Research has lapped up news of Sime Darby Bhd's new leadership lineup for each of its entities and the firm has given the conglomerate an outperform call with a target price of RM9.72.
On Friday, Sime Darby announced that the new leadership for its units was to pave way for the formation of three pure plays: Sime Darby Plantations, Sime Darby Properties, and Sime Darby Group.
"The management changes would see Sime Darby’s current group chief executive officer (CEO), Tan Sri Mohd Bakke Salleh become Sime Darby Plantation’s executive deputy chairman and managing director.
Sime Darby will see a new president and Group Chief Executive, led by Jeffri Salim Davidson, who is the current Deputy Group CFO of the group. Meanwhile, both plantation and property units are on course for listing by year-end," PublicInvest Research wrote in its company update report.
The report added that for its property unit, Permodalan Nasional Bhd group chairman Tan Sri Abdul Wahid Omar has been named as chairman of Sime Darby Property.
"Sime Darby's deputy chairman Tan Sri Dr Wan Abdul Aziz Wan Abdullah, who is also Malaysia Airports Holdings’ chairman, has been promoted to become group chairman, while Jeffri Salim Davidson will become its president and group chief executive," the report added.
The company update went on to say that Siem Darby's demerger exercise will see the separate listing of plantation and property units while other units like industrial, motors, logistics and other non-core businesses will remain under Sime Darby Group.
"We laud the key changes as it paves the way for demerger exercise by year-end. It is important to have the right leadership to maximize the value of each entity given the sizeable assets that both companies have," PublicInvest Research concluded in that note.