This article first appeared in The Edge Financial Daily on September 28, 2017
KUALA LUMPUR: The Sultan of Johor, Sultan Ibrahim Sultan Iskandar, is expected to surface as a substantial shareholder of loss-making Berjaya Assets Bhd (BAssets), according to sources.
Two sources told The Edge Financial Daily that the Johor ruler bought 80 million shares or a 6.7% stake in BAssets off-market yesterday.
It is learnt that he bought the shares at RM1 apiece, representing a 14.5% or 17 sen discount to BAssets’ closing price of RM1.17 yesterday.
Ultimately controlled by prominent tycoon Tan Sri Vincent Tan Chee Yioun, BAssets is the developer of Berjaya Times Square in Kuala Lumpur, one of the country’s largest retail and commercial projects. The group also owns Natural Avenue Sdn Bhd, which operates number forecast lotteries in Sarawak.
BAssets has also obtained a licence agreement with Greyhound Café Co Ltd for exclusive rights to establish and operate cafes under the Greyhound Café trademark in Malaysia.
Another source says Sultan Ibrahim is likely to continue to mop up more BAssets shares to at least a double-digit percentage stake.
At press time, it is not known what the Johor Sultan’s total shareholding in BAssets is.
The rules state that a substantial shareholder must notify a company within seven days of the date of change in his or her shareholdings, as required under the Companies Act 1965.
It is not yet publicly known who the seller of the 80 million shares or 6.7% stake in BAssets is. However, Tan held a controlling 63% stake in BAssets — of which 37.7% was direct interest and 25.3% was deemed interest via Berjaya Corp Bhd — as at Aug 17.
Interestingly, the Johor ruler has already invested in several companies in which Tan also has a stake in. They are convenience store chain operator 7-Eleven Malaysia Holdings Bhd and telecom solutions provider REDtone International Bhd, as well as U Mobile Sdn Bhd, the country’s youngest telecommunications operator.
Yesterday, BAssets saw 80 million shares, representing a 6.7% stake in the company, traded off-market. Bloomberg data showed that the shares were traded in five separate blocks, all of which changed hands at RM1 per share or RM80 million in total. All five trades were done between 3.30pm and 4.30pm.
One block of 20.22 million shares, a block of 17 million shares, two blocks of 19 million shares each, and a block of 4.77 million shares were crossed off-market.
Year to date, shares in BAssets have risen 29%, with a market capitalisation of RM1.39 billion.
Mercury Securities — the only research house that covers BAssets — has a “buy” call on the stock, with a target price of RM1.62. This represents a potential upside of 40%.
BAssets saw its net loss narrow by 80% to RM11.11 million in the financial year ended June 30, 2017, from RM54.12 million the previous year.