Group MD’s offer to take over BCB gets tepid response

Artist's impression of BCB's high-end condominium project in Mont'Kiara, Kuala Lumpur -- Concerto North Kiara.

KUALA LUMPUR: The mandatory offer to take over property and construction firm BCB Bhd has received only 10.09% valid acceptances level at the offer’s close on Monday.

In a filing with Bursa Malaysia, BCB said the offeror Evergreen Ratio Sdn Bhd -- a company controlled by BCB group managing director Datuk Tan Seng Leong and family -- and the persons acting in concert with it (PAC) had raised their holding to 57.87% of BCB shares.

This was up from 47.78% on July 6, the date when the offer document was sent out.

With more than 50% of the voting shares now in the hands of Evergreen Ratio and PAC, the offer has become unconditional despite the low level of acceptances.

On July 16, KAF Investment Bank Bhd, the independent adviser appointed by the BCB board, had urged minority shareholders to reject the takeover offer by Evergreen.

KAF said the offer was “not fair and not reasonable” on the notion that the offer price was unattractive.

The adviser said the offer price represented a discount of 18.77% over the one-year volume weighted average market price. “Such discount presents an unattractive offer to investors of BCB to realise investment in BCB shares.”

On July 6, when the offer document was despatched, BCB shares closed at RM1.05 -- higher than the offer price. 

The mandatory takeover offer of BCB was triggered on June 15 when Evergreen Ratio bought 11.26% in the company (excluding treasury shares) for RM22.553mil (or RM1 per share) that boosted its stake to 44.08%.

At the time, the offeror and its PAC owned about 55.92% of the issued shares. The ultimate offeror is Datuk Tan, whose family owns 94.99% in Evergreen Ratio.

Tan and four other BCB directors, comprising his children and his younger sister, are deemed interested in the offer.

Evergreen Ratio has said that it intended to maintain the listing status of BCB. To delist BCB would have required Evergreen to secure 90% or more of the listed shares (excluding treasury shares).

BCB’s projects include the Home Tree gated and guarded community project in Kota Kemuning, Shah Alam, with total gross development value (GDV) of RM1.8bil (BCB has a 70% stake in the joint venture) and six tower blocks in Medini, Iskandar, with a GDV of RM1.2bil (it owns a 60% stake). BCB also owns the 214-room Prime City Hotel in Kluang, Johor.

BCB shares closed 6 sen lower at RM1.25 on Monday.