PETALING JAYA: Cycle & Carriage Bintang Bhd’s (CCB) shares surged to a six-month high today, following news that its major shareholder Jardine Cycle & Carriage Ltd (Jardine CCL) was proposing to take the company private.
CCB shares hit limit up at RM1.67, a rise of 38 sen or 29.46% after it resumed trading today with 49,000 shares done. It is likely to see the stock hitting another limit-up to trade closer to the offer price of RM2.20 per share.
To recap, Jardine CCL proposed taking CCB private via a selective capital reduction and repayment exercise at RM2.20 per share, a 91 sen or 70.5% premium against its previous traded price of RM1.29.
According to a filing with Bursa Malaysia, Jardine CCL said the rationale for the proposed SCR came on the back of several reasons, namely: a challenging operating and trading environment, a long term commitment by Jardine and additional capital investments expected for CCB, an opportunity for entitled shareholders to realise their holdings, and seeing a minimal benefit from the listing status.
The acceptance period for the proposed SCR will close on Dec 6.
CCB is the dealer of Mercedes-Benz vehicles in Malaysia. For the nine-month period up to September 2019, CCB incurred a net loss of RM16.95 million against a net profit of RM17.82 million in the same period last year.
