KUB shareholders advised to reject Anchorspace takeover offer

PETALING JAYA: Independent adviser Affin Hwang Investment Bhd has advised shareholders of KUB Malaysia Holdings Bhd to reject the takeover offer by Anchorspace Sdn Bhd, which is deemed “not fair” and “not reasonable”.
In an independent circular released yesterday, Affin Hwang said the offer price is not fair as it represents discounts of between 28.59% and 40.68% against the five-day to 12-month volume weighted average market prices.
Meanwhile, it noted that the offer is not reasonable because Anchorspace does not intend to invoke the provisions of Section 222(1) of the Capital Markets and Services Act to compulsorily acquire any remaining shares for which acceptances have not been received.
“In view that the KUB shares are relatively liquid and will remain traded on Main Market of Bursa Securities, the holders have opportunity to realise their investments through open market at the prevailing market price which is higher than the offer price.”
However, Affin Hwang said there is no assurance that KUB shares will continue to trade at the prevailing market price, which is higher than the offer price; as well as maintain the current volume liquidity.
“It is important for the holders to keep in mind the transaction costs involved should they decide to sell their KUB shares through the open market.”
Anchorspace Sdn Bhd proposed to acquire the remaining shares it does not own in KUB for 35 sen per share after it triggered a mandatory general offer (MGO) threshold. The takeover offer will remain open for acceptance until 5pm on July 19.
Separately, KUB has issued a circular for an EGM on Aug 2 to deliberate its proposed acquisition of a parcel of oil palm plantation measuring 1,534 ha in Sungai Kinabatangan, Sabah from Kwantas Corp Bhd’s subsidiary Kwantas Plantations Sdn Bhd for RM100.45 million.
The acquisition is expected to be funded by internally generated funds and borrowings.
KUB’s share price fell one sen or 1.9% to close at 50.5 sen yesterday on some 2.61 million shares done, giving it a market capitalisation of RM281.02 million.