Case of "Sutera Liner"

Essay by Rashad871University, Ph.D.A-, March 2005

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Sutera Liner was registered on 22nd April 1998 and its core business is provision of express bus services. The business started in 1996 when Abd Rahim Mohamed (Hj Rahim) acquired a dormant bus company, Tembah Sdn. Bhd. Tembah was formed way back in 1981 and was issued with licences to operate on the Kuala Lumpur-Kota Bharu route, however the company operated only for a short period and subsequently ceased activities. Hj. Rahim's rationale for buying Tembah is to utilise its operating licence for the KL-Kota Bharu route as LPKP ceased issuance of new bus permits.

Later In the following year and in 1998 Hj Rahim bought over Warisan Mesra Sdn. Bhd (Warisan) and Johor Bahru Ekspress Agensi (M) Sdn. Bhd. (JBEA). Similarly both companies are considered as failed bus concerns and in the case of JBEA, it has stopped business activities since 1994. As with the case of Tembah, these companies were acquired from their respective owners at a reasonable price with the sole intention of utilising their valid express bus licences.

All legal encumbrances and liabilities of these companies have been fully settled.

HJ Rahim managed to turn around these three companies after a short period of operations. New high-powered buses were procured with all buses running under a common trademark of "Ekspres Sutera ". He later set up Sutera Liner as a transport management concern to organise and co-ordinate the activities of Warisan, Tembah and Mesra. Sutera Liner then was also involved in the business of leasing buses to these 3 companies.

In December 1999, Hj Rahim was given the permission by LPKP to consolidate all licences of Tembah, Warisan and JBEA under Sutera Liner. Beside this consolidation go-ahead, Sutera Liner was also awarded extension on its existing routes together with another 35 additional new licences. Effectively...