Petaling Garden also going private

PETALING JAYA: Permodalan Nasional Bhd (PNB) has proposed to take Petaling Garden Bhd private for RM493mil, the asset manager's second offer in three days to buy out minority shareholders in property companies in which it already owns majority stakes. 

Under the plan announced by AmInvestment Bank Bhd yesterday, PNB will offer RM2.50 for each Petaling Garden share not owned by the group. 

The offer values Petaling Garden at RM964mil, or 16% higher than its current market capitalisation of RM828.6mil. 

PNB and funds under its management have a combined 48.8% stake in the company. 

Shares in Petaling Garden were traded at RM2.11 before their suspension yesterday. The stock has risen 34% year-to-date. 

PNB's latest bid is also at a premium to Petaling Garden's net asset value of RM1.68. 

Petaling Garden is involved in property development, palm oil plantations and hotel management. 

In a statement to Bursa Malaysia, the Petaling Garden board said the firm was not seeking an alternative person to make a takeover bid. 

The directors would also appoint an independent adviser for the company's minority shareholders to advise on the PNB offer. 

On Tuesday, PNB offered RM670mil to de-list Island & Peninsular Bhd after buying its shares for RM2.35 each. 

PNB did not give any reasons for the bids, but analysts believe the stocks' low valuations and lack of liquidity were among key considerations for the privatisation. 

“Both offers are reasonable and should be well received by the minority shareholders,'' an analyst said. 

Petaling Garden made a net profit of RM70mil, or 18.2 sen per share, on revenue of RM215mil in financial year ended Dec 31, 2006 (FY06). 

Standard & Poor's, in a March 7 report, said the company's revised net asset value was RM2.15 as of end last year. 

It also forecast Petaling Garden would make a net profit of RM56mil in FY07, boosted by improved property sales and higher selling price for crude palm oil. 

Meanwhile, Bernama quoted Petaling Garden finance executive director Ahmad Fuaad Kenali as saying the company would be launching a few projects with a total gross development value of RM550mil this year. 

 PGARDEN :  [Stock Watch]  [News]