Weida major shareholder proposes RM2.40 a share to take it private

Temporary anti-dumping measures on ethanolamine products produced in the Malaysia, Saudi Arabia, Thailand and the United States is also being introduced.

KUALA LUMPUR: Weida Management Sdn Bhd, a major shareholder of Weida (M) Bhd, intends to privatise the company and delist it from the Main Market of Bursa Malaysia via a selective capital reduction (SCR) and repayment exercise.

Weida Management and persons acting in concert hold about 33.3% of the issued share capital in the company, and are offering a cash repayment of RM2.40 for each Weida share to entitled shareholders, amounting to RM203.17mil for 84.65 million shares.

"Pursuant to the proposed SCR, the issued share capital of Weida will be reduced by way of cancellation of the Weida shares, resulting in the reduction of the issued share capital of Weida by RM203,168,016 representing 406,336,032 Weida shares," said Weida Management in its filing to Bursa Malaysia.

However, given that Weida's issued share capital comprises only 133.33 million shares worth RM66.67mil, a proposed bonus issue will be undertaken to increase the share capital to a sufficient level for the capital reduction.

Weida Management said its intention to delist the company is owing to the listing's minimal value-add and relevance to the company, the lack of analyst coverage, investor interest and low liquidity.

It added that investors at large are unable to accord Weida with a valuation in line with its net assets, while the proposed SCR is an opportunity for shareholders to exist and realise their investment in Weida at a premium ranging from 19.94% to 23.64% based on the five-day to one-year volume weighted average price.

Weida was suspended for trading on Monday pending the announcement. It last exchanged hands on Friday at RM2.05 a share on very low trading volume.