PETALING JAYA: An off-market transaction of 18.75 million shares, or a 11% stake, in Tatt Giap Group Bhd was crossed yesterday morning at 31 sen.
This was a premium of 13.5 sen over Tatt Giap’s Wednesday closing price of 17.5 sen.
The transaction marks the entry of a new shareholder to revive the fortunes of Tatt Giap, as well as to inject assets and a new business into the company.
For now, Tatt Giap remains a loss-making steel company.
Following this transaction, Tatt Giap closed the day up 3.5 sen to 21 sen and was one of the most actively traded counters. The value of this off-market transaction was RM5.81mil.
The new shareholders are rumoured to be closely linked to Pasir Gudang-based Dynaciate Engineering Sdn Bhd, a downstream oil and gas company involved in construction, fabrication and engineering works.
Expectation that Dynaciate is the new shareholder isn’t improbable, as on Oct 31, Tatt Giap had announced that it had won a RM67mil contract from Dynaciate to undertake various sub-contracting works, which involved civil, architectural and piping prefabication in Johor.
Formed in 2002, Dynaciate is led by its managing director Khoo Song Heng, with the main asset being its steel factory in Pasir Gudang. The company has a workforce of close to 300.
Its clients include oil and gas and petrochemical companies such as the Technip Group and the Titan Group.
The vision statement on its website states that the company looks to be an industry leading engineering, procurement and construction (EPC) solutions provider.
Buying a strategic stake in Tatt Giap wouldn’t appear too costly, considering the company only has a market capitalisation of RM35.8mil at its closing price of 21.5 sen yesterday.
The existing substantial shareholders of Tatt Giap are Arich Holdings Inc, which holds a 13.89% stake, followed by Fong Chee Liang, Kier Ooh Heng and Hock Seng Lee with 4.9% stake, respectively.