Accept takeover offer, Denko shareholders advised

PETALING JAYA: Independent adviser TA Securities Holdings Bhd deems the unconditional takeover offer of 60 sen per share for Denko Industrial Corp Bhd as “fair and reasonable”, advising the shareholders to accept the offer.
Last month, Denko, which is involved in plastic injection moulding and wholesale of foodstuff, announced the offer from Oregon Technology Sdn Bhd (OTSB) to acquire all of its ordinary shares at 55 sen per share, which was then revised to 60 sen per share.
In an independent advice circular filed with the stock exchange yesterday, TA Securities said the revised offer price represents a premium of 6 sen or 11.11% to the net asset value per Denko share of 54 sen, thus it is deemed as “fair”.
TA Securities is also of the view that the offer is “reasonable”, as it represents an opportunity for the stakeholders to realise their investment in Denko at the offer price, without any other competing offer on the table.
“Nevertheless, we wish to highlight that subsequent to the serving of the initial notice, the market prices of Denko shares have traded above the initial offer price and revised offer price.
“The five-day volume weighted average mid prices and closing price of Denko shares as at the LPD were RM0.6566 and RM0.6362 respectively,” it said.
As such, TA Securities said the shareholders may have the opportunity to sell their shares in the open market at higher prices than the revised offer price but should be mindful of transaction costs.
“We wish to reiterate that we have not taken into consideration any specific investment objective, financial situation or particular needs of any individual shareholder or any specific group of shareholders,” it added.
Denko’s shares closed lower 0.75% or half a sen at 66 sen yesterday, with some 320,800 shares traded.