KUALA LUMPUR: Independent adviser Public Investment Bank Bhd has advised minority shareholders of Goh Ban Huat Bhd (GBH) to accept Paragon Adventure Sdn Bhd’s offer to acquire all remaining shares for RM1.40 per share.
The takeover offer came after tycoon Tan Sri Robert Tan Hua Choon sold his 51% stake in the ceramic products company to Paragon Adventure for RM145.71mil. The takeover offer included its warrants, which were priced at 40 sen a piece after having considered the exercise price of RM1 per warrant.
Paragon Adventure intends to maintain Goh Ban Huat’s listing status on Bursa Malaysia’s Main Market.
Public Investment Bank said based on its evaluation, the offer is “fair and reasonable” as it provided an exit opportunity to the holders to realise their investment in GBH in cash at the offer price.
“Accordingly, we advise and recommend that holders to accept the offer,” it added.
Public Investment Bank noted that the Shares Offer Price is lower than and represents a discount of 2.10% over the last traded price of GBH Shares as at Sept 26 of RM1.43 and a discount of 2.78% over the last traded price of GBH Shares as at the Oct 23 of RM1.44.
“Notwithstanding that, the shares offer price represents a premium ranging from 1.45% to 3.70% over the 1-month, 3-month, 6-month and 12-month VWAMP of GBH Shares up to Sept 26,” it added.
In addition, it opined that GBH Shares were illiquid as the average monthly trading volume of the free float of GBH Shares for the past 12 months up to September 2017 of 0.07% is lower than the average monthly trading liquidity of KL Industrial Production Index for the past 12 months up to September 2017 of 10.81%.
“Thus, the holders of offer shares may have limited opportunities to realise their investment in GBH in the open market at a price equivalent to or higher than the shares offer price,” it said.
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