G Team's offer to take over Maika turns unconditional

  • Business
  • Wednesday, 14 Jul 2010

PETALING JAYA: G Team Resources & Holding Sdn Bhd’s offer to take over the scandal-ridden Maika Holdings Bhd turned unconditional yesterday, after having received acceptances of 67.64% or 84.55 million shares. Subsequently, G Team and parties acting in concert (PACs) with it also extended an unconditional takeover offer for Maika’s 74.16% subsidiary, Oriental Capital Assurance Bhd (OCA), at RM1.61 cash per share.

The takeover offer for 24% or 24 million OCA shares not already held by Maika is in line with the obligation under the takeover code involving downstream entity. According to the takeover notice, the PACs for the purpose of the offer is GRYSS Holdings Sdn Bhd – a private vehicle of Westports Malaysia Sdn Bhd executive chairman Tan Sri G. Gnanalingam and family.

The offer for Maika shares became unconditional after G Team secured 51% shares acceptances. This also means that G Team, controlled by Gnanalingam, is one major step closer to taking over Maika and selling the assets, after which it plans to liquidate the company that has long been a bane to the Indian community.

With that, G Team had commenced the takeover of the responsibilities of Maika board and the operations of the company and was also awaiting official confirmation by the authorities to appoint new directors, said the company in a statement. Bank Negara has also imposed a condition that G Team is required to dispose of OCA to an interested investor within 12 months from the completion of the OCA offer.

In another statement issued by CIMB Investment Bank Bhd on behalf of G Team, it pointed out that of the 67.64% acceptance received as of July 12, 50.80% was “verified as valid acceptances” while 16.84% was subject to verification.

“There are some administrative issues to complete with regard to their documentation especially those with lost share certificates and those representing deceased shareholders. Shareholders are still walking into Tricor (Investor Services) and Maika offices to submit their acceptance form,” G Team said, adding that it was still opened to accepting the shares, especially from those who had lost their share certificates or other related issues.

“The saddest part is that there are more than 10,000 shareholders whose addresses are untraceable while many of the shareholders who have passed away had not informed their next-of-kin of their shareholding. It was our original intention to assist the very poor and we will not stop despite these obstacles. According to the laws of the takeover, we will keep the takeover offer open until 5pm on July 30.

“We have engaged the services of several NGOs (non-governmental organisations) especially the Sri Murugan Centre and EWRF (Educational, Welfare & Research Foundation) plus we have sent mobile teams to visit the estates where shareholders are located to assist them to fill the forms and submit their documents,” it said.

OCA, Maika’s subsidiary, is principally engaged in the underwriting of all classes of general insurance business. For the financial year ended December 2009 (FY09), OCA made a net profit of RM12mil from a loss of RM5mil in FY08 on the back of an operating revenue of RM252mil and RM258mil respectively.

Earnings per share in FY09 stood at 12 sen from a loss position of 4.9 sen previously. Noteworthy is that there has been a slew of resignations in OCA’s seven-member board, more so since the start of this year.

In the company’s latest annual report 2009, it said Vell Paari, son of MIC president Datuk Seri Samy Vellu and CEO of Maika Holdings, had resigned from the OCA board on March 25 this year while chairman Tan Sri Dr K. Ampikaipakan and Katsuhiro Mori resigned in early January this year. Datuk C. Vijaya Kumar, chairman of Maika, was appointed OCA chairman on Jan 6 to succeed Ampikaipakan.

Maika’s current three-men board composition, said the company in the annual report, had failed to comply with Bank Negara’s “Prudential Framework of Corporate Governance for Insurers” which requires a minimum of five directors.

Related Stories: G Team boosts paid-up capital G Team just short of 4.56% for Maika takeover Extension urged for Maika offer Maika concurs with independent adviser Maika’s end-2008 accumulated losses at RM106.7mil Offer documents sent to Maika shareholders Conditional takeover notice served on Maika board

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