Kenanga IB: Proposed acquisition of Inter-Pacific is to boost remisier base

KUALA LUMPUR: Kenanga Investment Bank Bhd (Kenanga IB) has revealed that the proposed acquisition of the stockbroking business of Inter-Pacific Securities Sdn Bhd (Interpac) is mainly for the latter’s remisiers.
Kenanga IB announced on Monday that it has been given the nod by Bank Negara Malaysia (BNM) to commence negotiations in relation to the acquisition of the stockbroking business of Interpac, subject to, amongst others, all parties concluding the negotiations within six months.
Kenanga IB group managing director Datuk Chay Wai Leong did not disclose the acquisition price, explaining that talks are still ongoing.  
“We just want to expand our remisier base. It’s going to be number one but ‘further ahead number one’,” he told reporters after the group’s AGM today. 
Kenanga IB operates through 32 branches nationwide and boasts the largest remisier network in the country. Chay said it has about 1,000 remisiers.
Interpac is an indirect subsidiary of Berjaya Capital Bhd, which in turn is part of Berjaya Corp Bhd. Established in 1972, Interpac has five branches across Kuala Lumpur, Penang and Johor Baru with a paid-up capital of RM250 million. Interpac has 230 remisiers and dealers.
“It helps with the branches but that’s not really the reason why we’re buying,” said Chay. 
The potential acquisition will further strengthen Kenanga’s leading position in the retail broking space to become the top two largest stock broker by trading value in Malaysia, with a combined market share of over 10% and retail market share of about 25%.
The proposed acquisition will be financed by shares of Kenanga IB and cash.
Going forward, Kenanga IB wants to further consolidate its leadership position in the retail segment of the capital markets industry, focusing on profitability, returns to shareholders and continue to be ahead of the game in future proofing its strategy through fintech and strategic partnerships.