InvestPenang director Lee Kah Choon today said rumours circulating that the state is in distress due to several mergers and acquisitions (M&As) resulting in multinational companies closing down their Penang operations are untrue.

Speculation in social media detailing the companies affected by shutdowns and M&As have also been dismissed by the Penang government, but this has not stopped MCA from blaming Chief Minister Lim Guan Eng for the perceived situation.

Lee said that M&As were commonly carried out to consolidate operations and to strengthen market share and technology synergies.

“This is happening globally in the semiconductor and electrical and electronics technology companies, and Penang, as an electronic hub with its many international companies, is invariably impacted,” Lee told a press conference in George Town.

Lee said in Penang, only five multinationals recently announced their M&As including AMD, which will initiate a joint venture with Nantong Fujitsu Microelectronic Co.

He said its manufacturing site in Penang will remain in operation with the company announcing 'no planned workforce reductions in Penang's AMD facility'.

He also noted that Sanmina Corp will take over Motorola Solutions’ manufacturing facility in Bayan Lepas, while it focuses on research and development in Penang, he added.

“They confirmed that the sale does not change Motorola’s commitment in Malaysia and allows Motorola Solutions to deliver 'best in class' service to its partners and customers.

“It was also reported in a local press on Oct 14 that the transfer does mean there will be a reduction in staff,” Lee said.

No factory closures

On Western Digital, Lee said the company has announced it was acquiring SanDisk for US$19 billion in cash and stock and it currently has 1,042 employees.

As for Amphenol, he said the company will close one part of its business in Penang affecting150 employees.

However, the company will continue manufacturing its high-speed connectors at two other plants on the mainland, which employ 800 staff, Lee added.

As for Dell’s acquisition of EMC at US$67 billion, he said it was made to ‘develop the company in areas where IT is moving’.

“So, from all of the above, it can be seen that only 150 jobs in Penang are affected.

“More job consolidations could be happening due to other M&As, but there is no news of any factory closures todate.

“Corporate movements will impact Penang, as host to many MNCs, and also other states in Malaysia,” Lee said.

He added that in Penang, investments in the manufacturing sector remained robust.

He pointed out that several new businesses like Jinko Solar as well as JA Solar, both multinational Chinese companies, have started operations in Penang offering a total of 1,900 jobs.

He said Hewlett-Packard was also constructing its factory in Batu Kawan and will employ 1,000 staff when fully operational.

“Overall, according to Malaysian Industry Development Authority (Mida), a total of 17,896 new jobs will be created in Penang via approved investments last year and 13,199 new jobs via approved investments in the first half of this year.”

He said Penang managed to attract RM48.2 billion worth of investments from 2008 till last year, which is 93 percent higher than the RM24.9 billion over a similar six-year period from 2001 to 2007.

Companies should clarify

In addition to manufacturing, the services sector, especially global business services and shared services outsourcing, continues to offer high value job opportunities, Lee added.

He pointed out that HP recently started a finance centre at the PDC Technoplex, while others include Osram’s GBS centre which hired 150 staff, with Jurong Engineering Design Center having 200 staff.

Lee also said the Penang Career Assistance and Talent (CAT) Centre continues to provide assistance to job-seekers and employers looking for the right candidates.

As of Oct 26, there were a total of 3,246 vacancies in Penang through job portals linked to the CAT Centre.

The state government via investPenang is working closely with companies that have made announcements to assist and smoothen their transitions, Lee said.

“However, for companies that have yet to make any official statement due to confidentiality requirements at this stage or for other reasons, we urge them to clarify matters to quell the spread of rumours,” said Lee.

“As an international city where many multinationals are located, Penang will be subjected directly to vagaries of global business trends.”

“We, however, remain positive in facing these challenges and will remain steadfast in assisting all our investors and employees,” said Lee.