KUALA LUMPUR (July 7): Shareholders of ECM Libra Group Bhd have been told to reject the takeover bid by Datuk Lim Kian Onn, the group's non-independent and non-executive director, who has made a conditional mandatory general offer (MGO) to buy out minority shareholders of the group, according to independent adviser DWA Advisory Sdn Bhd.
The independent adviser also deemed the takeover offer as “not fair” and “not reasonable”.
DWA Advisory added that the offer price of 22 sen per share is “not fair” as the offer price is lower and represents a discount of approximately 37.14% to the estimated value of the group’s shares of 35 sen based on revalued net asset value.
It also said the takeover offer is not reasonable as the group’s shares will remain tradable on the Main Market of Bursa Securities and hence, the shareholders will still have the opportunity to realise their investment in the group’s shares in the open market after the closing date.
“Accordingly, DWA Advisory recommends that the shareholders reject the offer.
“The non-interested directors (collectively Datuk Seri Kalimullah Masheerul Hassan, Datuk Kamarudin Md Ali, Mahadzir Azizan and Oh Teik Khim) have concurred with the opinion of DWA Advisory that the offer is not fair and not reasonable, and recommend that the shareholders reject the offer,” it said.
In May this year, Lim made an MGO to buy out the minority shareholders of the group.
This comes after Lim on May 31 acquired an additional 19.2 million shares or 4% stake in the group — via a direct business transaction — from Tune Group Sdn Bhd for RM4.22 million or 22 sen per share.
The purchase raised Lim's equity interest in ECM Libra to 11.68% from 7.68% previously.
The collective shareholdings of Lim and other persons acting in concert, meanwhile, rose to 38.84% or 186.42 million shares, triggering the conditional MGO for the remaining shares.
A check on Bloomberg revealed that Julius Baer Group Ltd is the largest shareholder of ECM Libra with a 21.95% stake, followed by Tune Group (20.79%), Garynma MY Capital (15.98%) and Kalimullah (14.7%)
At the time of writing on Thursday (July 7), shares in ECM Libra traded five sen or 2.38% higher at 21.5 sen, giving it a market value of RM103 million.