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1 FNCE 3000 CORPORATE FINANCE CASE STUDY Name Student ID Chuan Li Yan 17625542/7E3B2636 Tan Chew Lee 16907061/7E3A2002 Tutor : Saifur RahmanTutorial Date & Time : Thursday 9amSemester and Campus Details : 2016 Semester 1, MiriCampusCompany Name : Maxis BerhadWord Count : 3865 words
2 IntroductionMaxis Berhad is the well-known leading communications company which is an internet service provider in Malaysia. As Maxis’s customer increasingly immerse themselves in the world of technologically advanced, Maxis is bringing the advanced and providing an unmatched end-to-end Internet experience for their customer.1Maxis is founded in 1993 and the first operator to launch 4G LTE in Malaysia.2Maxis provided a variety of communications service included mobile, fixed line, and international telecommunications services in Malaysia, internet and broadband services, wireless multimedia related services.3In this case study, explore and discover of Maxis will be made in order to find what kind of shareholder will be focus by Maxis. Other than that, risk-return analysis will be implemented to identify the risk that will affect the company and the investors. Last but not least, the cost of capital will be discovered in order to determine which investment projects would be considered by the company. 1.0 Shareholder AnalysisMaxis has a 41,544 number of shareholders in total. There are 21,803 numbers of shareholders represent only 0.27% of total issued shares whereas there have three majority shareholders own 80.57% of total issued shares (Appendix 1.1).4The shareholders are formed from individuals, bank or finance companies, investment or foundations or charities, government agencies or institutions, nominees, and other type of companies. There are 90.24% of shares held by individuals whereas Maxis only get 0.01% of shares investment from investment trusts and government agencies each (Appendix1.2).5This shows a big gap between different categories of shareholders in which the investors of Maxis are not well-diversified. 1“Annual Report 2015”, Maxis Berhad, accessed on March 28th, 2016, 2“Maxis Berhad”, World Library, accessed on March 28th, 2016, 3“Company Overview of Maxis Communication Berhad”, Bloomberg Businessweek, accessed on March 28th, 2016, 4“Annual Report 2015” Maxis Berhad, -announcements/5037681, 180. 5Ibid.
3 1.1 Majority ShareholdersThe Appendix 1.3 shows the top 20 shareholders of Maxis. As mentioned before, there are three majority shareholders that hold 80.57% of total shares. The first major shareholder is BGSM Equity Holdings Sdn. Bhd. which holds 4,875,000,000 numbers of shares that represent 64.91% of total issued shares. BGSM is a holding company that provides fixed line, international telecommunication, and mobile services in Malaysia.6Each share worth RM0.10 and one share give the shareholders per voting right. Since BGSM owns