KUALA LUMPUR: Public Investment Bank has advised the minority shareholders of Ablegroup Bhd
to reject the takeover offer by Parallel Pinnacle Sdn Bhd at 13 sen each as it undervalued the assets of the company.
Public Investment Bank, which is the independent adviser, said on Monday the offer was not fair as it was lower than the realised net asset value (RNAV) per AbleGroup share and market price of AbleGroup shares.
The last traded price of AbleGroup Shares was 14 sen and the offer was at a discount ranging from 5.87% to 19.75% over the five-day, one-month, three-month, six-month and 12-month volume weighted average market price up to and including the last trading day.
"The offer price of 13 sen is lower than the RNAV per AbleGroup share of 22 sen which represents a discount of nine sen or 40.91% to the estimated RNAV per AbleGroup share," it said.
AbleGroup's core business is the trading of marble and granite slabs.
It said AbleGroup shares were relatively liquid as the average monthly trading volume of the free float of AbleGroup shares for the past 12 months up to September 2017 of 12.35% is higher than the average monthly trading liquidity of KL Industrial Production Index for the past 12 months up to September 2017 of 10.81%.
“Thus, the holders may have opportunity to realise their investment in AbleGroup in the open market,” it said.
Public Investment Bank noted the offeror intends to maintain the listing status of AbleGroup. As such, the shares of AbleGroup will remain traded on Bursa Securities and the minority shareholders would still be able to participate in the trading of AbleGroup shares after the closing date.
“We are of the view that the offer is not reasonable as the AbleGroup shares are relatively liquid. As such, holders may consider to realise their investment in AbleGroup in the open market in the event that the market price of AbleGroup shares is higher than the offer price as the offeror intends to maintain the listing status of AbleGroup,” it said.
The non-interested directors also concurred with the recommendation of Public Investment Bank and advised the minority shareholders to reject the offer.
Win a prize this Mother's Day by subscribing to our annual plan now! T&C applies.
