PETALING JAYA: The Tee family has launched a mandatory takeover offer worth RM670mil for oil palm grower United Malacca Bhd
(UMB) after buying out Great Eastern Life Assurance (Malaysia) Bhd’s stake.
An offer price of RM6.10 per share has been announced for the shares to be acquired under the takeover exercise. The stock closed at RM5.97 yesterday.
Prosper Trading Sdn Bhd, owned by Tee Kim Tee and his younger brother Tee Cheng Hua, acquired Great Eastern’s 13.44% on Oct 12 for RM171.93mil or RM6.10 per share.
Following this acquisition, Prosper Trading’s equity interest in UMB has increased from 5.82% to 19.26%.
The 78-year-old Kim Tee is the father of Datuk Seri Tee Lip Sin, the only executive director of UMB.
Prosper Trading, together with the stake held by persons acting in concert (PAC), cumulatively hold a 47.66% stake in UMB following the Oct 12 acquisition – exceeding the 33% threshold for mandatory takeover offer.
However, this is not the first time the offeror and PACs have exceeded the threshold.
The last time it was triggered was on Sept 26, 2024 although the requisite mandatory take-over offer was not extended at the time.
UMB told the bourse the offerors intend to “regularise the position” via a cash compensation scheme.
The compensation shall be calculated based on the difference between the RM6.10 offer price and the price at which the relevant shares that were sold during the compensation period.
The compensation period was between Sept 26, 2024 and Oct 9, 2026.
“For the avoidance of doubt, the cash compensation scheme will not be extended to the PACs,” the bourse was told via a filing. Prosper Trading is now offering to buy the remaining shares it does not own in UMB for RM6.10 per share.
The offer price is at a 2.52% premium to the last transacted price on Oct 9.
It is also at a 2.59% premium to the five-day volume weighted average market price of UMB shares.
The offer is conditional upon the joint ultimate offerors, Kim Tee and Cheng Hua, securing sufficient valid acceptances from other shareholders to raise their combined stake in UMB to at least 50%.
This means the offerors only need to receive valid acceptances of about 4.9 million shares, representing 2.34% of total UMB shares, in order to fulfil the acceptance condition.
It is worth noting that the joint ultimate offerors intend to maintain the listing status of UMB on the Main Market of Bursa Malaysia.
