KUALA LUMPUR (Oct 31): UMW Holdings Bhd said today it will no longer be pursuing the proposed acquisition of a 50.07% stake in MBM Resources Bhd (MBMR) and the resultant proposed mandatory takeover offer (MGO).

The conglomerate is also giving up its takeover bid for a 10% stake in Perusahaan Otomobil Kedua Sdn Bhd (Perodua) and a proposed renounceable rights issue to raise gross proceeds of up to RM1.1 billion.

In a filing with Bursa Malaysia today, UMW said the board of directors has decided to allow the MBMR and Perodua offers to lapse and not to further extend the period for the corporate exercises.

“Given the current business environment, we have recalibrated our corporate strategy in line with our ongoing transformation efforts and will focus on improving our financial performance," said UMW president and group chief executive officer Badrul Feisal Abdul Rahim said in a separate statement.

"We would like to reaffirm our commitment to enhancing the performance of our automotive segment, expanding further into high-value manufacturing as well as increasing our product range and market presence for our equipment segment.

"We believe this will further strengthen our overall financial position, which will enable us to remain resilient in the increasingly challenging business environment,” he added.

Badrul said the group remains optimistic in exploring opportunities in the domestic market, as well as expanding its global footprints. "We are confident that the transformation efforts we have undertaken in the past few years will continue to benefit our shareholders and contribute positively to the overall growth of the Malaysian economy,” he added.

On April 4, UMW said it remained interested to resume discussions with MBMR’s major shareholders, Med-Bumikar Mara Sdn Bhd and its unit Central Shore Sdn Bhd (CSSB), to acquire the 50.07% stake in MBMR. UMW had made an MGO at RM2.56 per share in March.

Earlier, MBMR said it was notified that Med-Bumikar and CSSB had objected to UMW’s intended action to engage with their key principals, being the brand owners of the distributorship marques, on the merits of the proposed acquisition announced by UMW on March 26, 2018. It had also requested UMW to refrain from taking such intended action as it may confuse or mislead their key principals and may jeopardise their business contracts and/or relationship with their key principals.

MBMR holds dealerships for Perodua, Mitsubishi, Volkswagen, Volvo, Daihatsu and Hino.

UMW shares closed 6 sen or 1.28% higher at RM4.75 today, with 1.76 million shares done, bringing a market capitalisation of RM5.55 billion. MBMR shares, meanwhile, ended the day down 2 sen or 0.99% at RM1.99, with 154,800 shares traded, valuing it at RM777.87 million.