This also means that the proposed cash distribution of at least RM3.30 per share to Kian Joo shareholders is off, as returning the cash proceeds to them is conditional on the proposed disposal being completed.
There was a much-publicised but unsuccessful court battle to block Aspire Insight's takeover of tin can and cardboard carton maker Kian Joo. The length of the court battle may have helped to derail the plan, but the final deal-breaker is a disagreement over the sale’s price tag.
In a statement to Bursa Malaysia on Friday, Kian Joo said it and Aspire had mutually agreed to terminate the business sale agreement (BSA) signed in March 2014 and its ancillary agreements.
Explaining the reason, the company said it had engaged with Aspire for a better price for the proposed disposal in view of the improved performance of the Kian Joo group over the past two financial years.
“However, the company and Aspire could not come to a conclusion in respect of the price. The conditions precedent in the BSA were not completely fulfilled as it took the company more than a year to resolve the legal suit taken by a former director in relation to the BSA and by then, the valuation of the company is different from that of March 2014,” it said.
According to Kian Joo’s annual report, the company had until March 23, 2016, to fulfill the conditions precedent in the BSA.
Kian Joo said the various agreements on the sale would cease to have any effect and would become null and void, with neither party having any claim whatsoever against the other.
To recap, Kian Joo’s former director Datuk Anthony See had tried to stop the takeover of Kian Joo by Aspire Insight in court. He had alleged that Aspire Insight and Can-One (Kian Joo’s largest shareholder with over 30% equity interest) were related parties, so the latter should not be allowed to vote in the proposed sale of Kian Joo’s assets and liabilities to Aspire Insight.
Aspire is 60% owned by Alleyways Sdn Bhd, whose director Chee Khay Leong was the former chief operating officer of Can-One. The other 40%, meanwhile, is held by Ekuiti Merdu Sdn Bhd, which is controlled by Kian Joo’s major shareholder EPF. Together, Can-One and EPF own about 43% in Kian Joo.
On June 1 last year, the Court of Appeal dismissed See’s appeal against a High Court decision to strike out his suits.
Kian Joo shares shed 1 sen to close at RM3.14 on Friday, with 264,800 shares traded. Meanwhile, Can-One shares fell 2 sen to RM4.04, with 354,700 shares changing hands.
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