Why did UEM Sunrise, TM, and IIB end their managed services joint venture?

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UEM Sunrise, TM, and IIB Terminated Managed Services Joint Venture Due to Strategic Portfolio Streamlining

UEM Sunrise Bhd, Telekom Malaysia Bhd (TM), and Iskandar Investment Bhd (IIB) have mutually agreed to terminate their decade-old joint venture (JV) in managed services, which operated under the company Inneonusa Sdn Bhd. This decision aligns with UEM Sunrise's strategic objective to streamline its asset portfolio and enhance its focus on core business activities. The termination involves the voluntary winding up of Inneonusa, with all shareholders consenting to this resolution.
Strategic Rationale for Termination

The primary driver behind the termination is UEM Sunrise's initiative to streamline its asset portfolio. This strategic move aims to allow the property developer to concentrate more effectively on its core business operations. By exiting the managed services JV, UEM Sunrise can reallocate resources and attention to areas that are more central to its long-term growth strategy.
Background of the Joint Venture

The joint venture, established approximately ten years ago, was initially formed to provide smart in-building and smart city services within Iskandar Puteri, Johor. UEM Sunrise, as the master developer of Iskandar Puteri, collaborated with TM and IIB to leverage their respective expertise in technology and development for these services.
Shareholder Structure and Agreement

Inneonusa Sdn Bhd, the entity through which the JV operated, was structured with specific ownership stakes. Intelsec, a subsidiary of TM, held a 51 per cent share, while UEM Land, a subsidiary of UEM Sunrise, owned 39 per cent. IIB Property Services held the remaining 10 per cent stake. The decision to terminate the JV and proceed with the voluntary winding up of Inneonusa was unanimously agreed upon by all shareholders.
Financial and Risk Implications

The termination of the joint venture agreement is not expected to have a material impact on UEM Sunrise's financial performance for the fiscal year ending December 31, 2024. Specifically, there are no anticipated material effects on its earnings per share, net assets per share, gearing, share capital, or shareholdings. Furthermore, barring any unforeseen circumstances, no significant risk factors have been identified in relation to this JV termination agreement.

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Why did UEM Sunrise, TM, and IIB end their managed services joint venture?

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