Reject offer, DWA Advisory tells Euro Holdings minority shareholders (Update)

KUALA LUMPUR: Reject the takeover offer, independent adviser DWA Advisory Sdn Bhd told minority shareholders of furniture maker Euro Holdings Bhd as it described the offer of 44 sen a share as “Not Fair”.

DWA said in its independent advice to minority shareholders on Friday the offer price did not reflect the fair value of Euro Holdings shares as indicated in its realised net asset value (RNAV) and was below the market prices.

“As such, the Offer is Not Fair. The trading of Euro Holdings shares had been relatively liquid for the past 12 months and the joint offerors have indicated their intention to maintain the listing status of Euro Holdings.

“As such, the Offer is Not Reasonable as there are no sufficient reasons for the holders to accept the offer,” it said. 

DWA said Datuk Seri Mohd Haniff Abd Aziz, Lew Fatt Sin, Law Sim Shee, Lew Hin and Teh Hock Toh have confirmed their intention to reject the offer in respect of their shareholdings in the offer shares.

To recap, on Sept 2, Euro Holdings received a conditional mandatory takeover offer from its executive director and two major shareholders to acquire the remaining 52.3% of the share capital that they do not already own, for a cash consideration of 44 sen a share.

The joint offerors – executive director and a major shareholder, Datuk Seri Choong Yuen Keong and two other major shareholders, Datuk Tong Yun Mong and Tee Wee Sien -- want to acquire all the remaining shares in Euro not already held by them, amounting to 42.394 million shares. The offerors also intended to maintain the listed status of the company.

Tee had entered into a share purchase agreement with chairman Datuk Seri Mohd Haniff Abd Aziz, who is also a major shareholder, to acquire a 12.35% stake for RM4.2mil, or 42 sen per share, in cash.

Tong and Choong have also separately acquired a 1.85% and 2.09% stakes for RM660,000 and RM746,240, or 44 sen per share.

Following that, the offerors collectively hold an aggregate of 47.66%.

In its independent advice, DWA said the share price had been generally trading on an upward trend for the past one year up to and including the last trading date.

The shares had traded at a high of 68 sen on Sept 26, 2014 and a low of 54.5 on Sep 2, 2014. The last date when the shares were traded at 44 or below was on 16 July 2014 where a total of 8,214 shares were traded. 

At midday, the share price was down one sen to 64 sen.