SINGAPORE, Jan 21 ― Khazanah Nasional Bhd., Malaysia’s state investment company, said the value of its holdings climbed to a record last year as local share prices surged.

The net asset value of Khazanah’s investments climbed 19.1 per cent to RM103.5 billion at the end of 2013 from RM86.9 billion a year earlier, the Kuala Lumpur-based fund said in a statement today. It outperformed an 11 per cent gain in the benchmark FTSE Bursa Malaysia KLCI Index, which closed at a record on December 30.

“We are starting this year from a position of relative strength and hopefully our portfolio can handle any storms,” Khazanah Managing Director Azman Mokhtar told reporters in Kuala Lumpur today. Last year “was eventful with highlights including better operating performance across practically all investee companies and deepening of the regional presence of various companies.”

Khazanah owns stakes in some of Malaysia’s biggest listed companies, including electricity producer Tenaga Nasional Bhd., which rose 64 percent last year, the biggest gainer on the country’s stocks benchmark. It also controls Malaysia Airports Holdings Bhd., which jumped 73 per cent in 2013, and developer UEM Sunrise Bhd., which climbed 12 per cent, according to data compiled by Bloomberg. The fund’s 2013 returns compare with a 24 per cent increase in the MSCI World Index, the biggest gain since 2009, and a 5 per cent decline in the MSCI Emerging Markets Index.

Khazanah has cut non-core Malaysian interests, while making more acquisitions abroad after Prime Minister Datuk Seri Najib Razak called for state funds not to crowd out local entrepreneurs. The fund trimmed stakes in companies including Tenaga Nasional Bhd. last year and divested its entire 45 per cent stake in technology company Time Engineering Bhd.

The fund said pretax profit increased to RM3.1 billion in 2013 from RM2.1 billion a year earlier. It paid a RM650 million dividend to the government, according to the statement.

In 2012, it booked one-time gains from divesting national carmaker Proton Holdings Bhd. and initial public offerings for IHH Healthcare Bhd. and pay-TV operator Astro Malaysia Holdings Bhd.

Insurance acquisitions

Khazanah is seeking more Asian insurance investments, Azman said, adding it may list its insurance assets in the future. It teamed up with Sun Life Financial Inc. in January 2013 to buy 98 per cent of Aviva Plc and CIMB Group Holdings Bhd.’s Malaysian insurance joint venture for RM1.8 billion. It also bought a 90 per cent interest in Turkish insurer Acıbadem Sağlık ve Hayat Sigorta AS for US$252 million.

The fund also plans an initial public offering of its theme park business called Themed Attractions and Resorts Bhd., though it is no hurry, Azman said. This unit operates theme parks for brands including KidZania, Legoland and Hello Kitty.

Ganen Sarvananthan will leave as Khazanah’s head of investments on April 30 to join the Fort Worth, Texas-based private-equity firm TPG Capital as partner and managing director of its Asia business, the state fund said. He will be replaced by Dominic Silva, currently executive director investments, who will assume his new role from February 1.

Ahmad Zulqarmain Onn will join Khazanah on May 1 as executive director of investments, from government bonds-guarantee agency Danajamin Nasional Bhd. where he is currently chief executive officer. Zaida Khalida Shaari will be promoted to also become an executive director of investments from February 1, it said. ― Bloomberg