MWE receives RM391.4 million takeover offer from Surin Upatkoon

PETALING JAYA: MWE Holdings Bhd has received a takeover offer from tycoon Tan Sri Surin Upatkoon, via his private vehicle Pinjaya Sdn Bhd, at RM1.70 per share or a total of RM391.4 million.
According to Pintajaya’s offer letter, the purchase consideration will be satisfied by way of RM267.49 million cash, and a deferred amount of RM123.91 million left owing by Pinjaya to MWE.
Upon completion of the acquisition, Pinjaya will declare a distribution via a special dividend of RM1.70 per share as a capital repayment exercise, and thereafter the existing MWE shares will be cancelled.
“Upon completion of the proposed distribution, it is proposed that a delisting of MWE be implemented,” Pinjaya said.
Surin owns 75.1 million shares or 32.62% of MWE via a direct stake of 0.34% and an indirect stake of 30.80% through Pinjaya.
Surin is also non-independent chairman of Magnum Bhd and managing director of MPHB Capital Bhd, which in turn owns 51% of MPI General Insurans Bhd.
Simultaneously with the proposed distribution, MWE will issue two new shares to Pinjaya with an issue price of RM1 each, and the former’s share capital will be reduced to RM2 comprising two shares, which will be wholly owned by Pinjaya.
The offer letter stated that Surin and persons acting in concert with him would be entitled to the special dividend under the proposed distribution. However, Pinjaya said the entitlement will not be paid in cash, but will be set off against the deferred amount of RM123.91 million.
The takeover offer, which remains open for acceptance until Dec 10, 2015, will require the approval of MWE’s board of directors, except for Surin, shareholders at an extraordinary general meeting, and existing financiers.
MWE manufactures garments for customers, such as Nike, Lacoste, Oshkosh and Izod. It is also into property development, investment, and management, trades electronic products and components, manages golf course, and provides freight forwarding services.
MWE’s board said it will be appointing advisers before deciding on the next course of action in respect of the offer.
Following news of the takeover offer, MWE’s share price climbed 14% to RM1.59 yesterday with 185,000 shares done.