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A total of 354.59 million shares worth RM890.68 million changed hands off market in blocks of at least 500,000 units between Jan 7 and 13.

Masterskill Education Group  (MEGB) (fundamental: 1.2; valuation: 0.6) saw two large blocks totalling 101.6 million shares traded off market on Jan 8 and 13. A total of 72.44 million shares were done at 56 sen apiece and another 29.16 million shares were sold at 60 sen apiece, giving the transactions a combined value of RM58 million.

It is worth noting that the deals, which accounted for 24.8% of MEGB’s share capital, were made at steep discounts to the prevailing market prices of the shares. MEGB’s share price closed at 73.5 sen on Jan 8 and 67.5 sen on Jan 13.

The deals are likely linked to the subsidiaries of SMRT Holdings  (fundamental: 1.5; valuation: 1.8) and private equity fund Creador, which together have made a takeover offer to MEGB. On Jan 12, MEGB announced to Bursa Malaysia that it had received a notice of conditional takeover at a cash consideration of 60 sen per MEGB share.

Creador’s founder and CEO Brahmal Vasudevan said at a press conference last week that the acquisition is expected to be completed by end of March this year.
Berjaya Food (BFood) (fundamental: 1.55; valuation: 1.5) saw 13.92 million of its shares or a 3.75% stake change hands off market on Jan 12 and 13. The trades were done at RM2.90 and RM2.95 apiece respectively.

The transactions could be due to increased buying interest in anticipation of BFood’s next quarterly results, which are due in March. Last September, the company wrapped up the acquisition of Berjaya Starbucks Coffee Co Sdn (BStarbucks) after buying the remaining 50% stake owned by Starbucks Coffee International Inc for RM279.51 million cash.

BStarbucks and its popular coffee retail chain’s earnings have become a key growth driver for BFood as the former had reported an average annual net income growth of 40% in the past two financial years.

Meanwhile, OldTown (fundamental: 3; valuation: 1.3) saw a combined 2.86% stake traded off market between Jan 9 and 13. A total of 12.5 million shares were sold at between RM1.52 and RM1.55 apiece. Over the same period, OldTown’s share price increased from RM1.53 to RM1.67 last Thursday.

The transactions are believed to have been made by several foreign investment funds with substantial stakes in OldTown. According to a Jan 13 filing, Matthews International Capital Management LLC had disposed of some 500,000 shares on Jan 9 and 12, leaving it with a 5.5% stake in the company.

A separate filing shows that another US-based fund, Franklin Resources Inc, had acquired some 514,500 OldTown shares on Jan 9.

OldTown’s shares had underperformed the broader market over the past year, possibly due to its status as a stock with high proportion of foreign shareholding. The stock had declined 26% between Dec 31, 2014, and Jan 2, 2015, in line with the continuing foreign capital outflow from the Malaysian equity market.

Another notable off-market trade was seen in EcoFirst Consolidated (fundamental: 0.65; valuation: 0.3) where 20 million shares were transacted on Jan 13 at 16 sen apiece, which represented 2.74% of the company’s share base. The deal was done at a 50% discount to the stock’s closing price of 30 sen last Wednesday.

The company, which has interest in property investment, construction and biotechnology, is headed by CEO Datuk Tiong Kwing Hee, who had acquired a total of 8.27 million shares in December.

Over at Boustead Holdings (fundamental: 0.65; valuation: 1.8), 9.9 million shares were traded off market on Jan 7 at RM4.82 apiece or RM47.72 million in total.
The transaction was made at a substantial premium to the company’s share price, which closed at RM4.54 on Jan 14.

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This article first appeared in The Edge Malaysia Weekly, on January 19-25, 2015.

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