By KINIBIZ
Yesterday utility player Tenaga Nasional stated its confidence that its takeover bid for port operator Integrax will be successful, indicating that its offer price will remain at RM3.25 per share for now.
But here’s the thing: the Integrax board had earlier said it wants a higher price.
In a March 4 filing Integrax’s board said the revised offer is not fair but reasonable, taking into account the valuation of the company’s shares at RM3.60 to RM3.66 by independent advisor M&A Securities. Two substantial shareholders in Perak Corporation and Halim Amin Rasip, who collectively control a little under 37% between them, seems opposed to the offer.
Soon after the Jan 9 offer, which was at RM2.75 per share, Halim remarked publicly that he felt Integrax shares are worth more than RM5.00 per share.
In turn Perak Corporation had stated that it will recommend its shareholders reject the offer unless Tenaga raised the offer by 18% to RM3.25. Tenaga did that quickly, but the March 4 announcement by Integrax signals a change of heart by Perak Corporation who now want more, it seems.
Now even more perplexing is RHB Research’s estimate that Integrax is actually worth up to a third less than what Tenaga originally offered at RM2.75 per share. Never mind Integrax shares never hit that level in the past 10 years prior to the offer. Will Tenaga end up over-paying by a heart-wrenching margin?
Of course the decision ultimately lies with the shareholders. And Tenaga, sitting on about 22% when it initiated the takeover bid on Jan 9, only needs a little under 30% as it is eyeing majority control.
Meantime here are some of our best news, analyses and commentaries this week in case you missed them:
Pick 1 — Pondering the ringgit. The Malaysian ringgit is now at a six-year low. But why? Does it fairly reflect our economic fundamentals? In this two-part report KiniBiz looks at what moves a currency and whether the ringgit is actually undervalued. Read here and here.
Pick 2 — Is Petronas in crisis? Petronas recently posted its a jaw-dropping quarterly loss of RM7.3 billion, its first red quarter since it began reporting its results publicly. Is this a mere blip or does it signal a crisis at the state-owned petroleum outfit? KiniBiz looks deeper in a two-part issue series here and here.
Pick 3 — The Big Bad Wolf story. Bookexcess is a one-of-a-kind book store and it runs a one-of-a-kind book event in the popular Big Bad Wolf Sale. So how did things begin for the book store? KiniBiz visits the founders to find out more and spends a day with the Big Bad Wolf. Read here.
Pick 4 — 1MDB coy on debt repayment plan claim. Earlier this week Reuters reported that debt-ridden 1Malaysia Development Berhad or 1MDB is pursuing a debt repayment plan that will see the sale of most of its assets. But when queried a spokesperson dodged the question of whether such a plan exists. Read on here.
Pick 5 — Mokhzani on surprise board exit. SapuraKencana Petroleum remains in good shape considering where the industry stands, said shareholder and co-founder Mokhzani Mahathir who surprised the market with a resignation from his vice chairman position earlier this week. Is this a prelude to another investing move? Read on here.
Pick 6 — Putrajaya should follow Penang’s WiFi footsteps. Earlier this week the Penang state government announced that Penangites will now have access to 1Mbps WiFi speeds for free. When will Kuala Lumpur progress to this level? Our resident cat offers a few ideas for Putrajaya to do this in the national capital. Read here.
Pick 7 — Too early to clear RM50 bil 1MDB of wrongdoing. There are grave issues with controversial 1Malaysia Development Berhad or 1MDB. While the prime minister said he had told the auditor-general to independently verify 1MDB’s accounts, the Cabinet had also concluded that there has been no wrongdoing. Isn’t that premature? Our resident cat ponders the contradiction here.
Pick 8 — Liew Kee Sin’s resignation that wasn’t. So it turns out property man Liew Kee Sin didn’t actually resign from his role as chairman of the Battersea redevelopment project. But he should. And the shareholders’ accommodation of his prolonged stay despite clear-cut conflicts paints a perplexing situation. Read our resident cat’s thoughts here.
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– by Khairie Hisyam Aliman, News Editor
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