KUALA LUMPUR: The Federal Land Development Authority (Felda) is said to be working on disposing of part of its stake in Malayan Banking Bhd (Maybank) at RM8 to RM8.05 apiece, in a move to raise up to US$63.1 million (RM281.8 million), according to Dow Jones, which quoted a term sheet sighted yesterday.
In a news report, the newswire said CIMB Investment Bank is the sole book runner for the deal, and officials at Maybank and Felda were not immediately available to comment.
When contacted, a Felda spokesperson declined to comment as he is not privy to the information, and efforts to reach its chairman Tan Sri Shahrir Samad were not successful.
Maybank’s 52-week price ranged between RM7.50 and RM9.20, the share price has been mostly downtrending after it went as high as RM9.17 on April 18 last year in the said period.
Based on Maybank’s annual report for financial year ended Dec 31, 2015 (FY15), Felda was listed as the fifth-largest shareholder with 185.15 million shares equivalent to a 1.9% stake in the banking group as at Feb 10 last year.
The disposal represents about 0.34% of Maybank’s issued and paid-up share capital.
Maybank shares closed 27 sen or 3.25% lower at RM8.05 yesterday, valuing the group at RM83.58 billion, the largest market capitalisation for a banking group in Malaysia.
Maybank was the fourth-largest decliner across Bursa Malaysia yesterday.
Felda has been under heavy scrutiny of late due to its plan to buy a 37% stake in Indonesia’s PT Eagle High Plantations Tbk for US$505.4 million.
Subsequent to the announcement of the said acquisition, CIMB Group Holdings Bhd’s chairman Datuk Seri Nazir Razak commented that the deal was overpriced.
The acquisition came at a time after Felda reported two consecutive fiscal years of losses after the public listing of Felda Global Ventures Holdings Bhd in June 2012.
According to the statutory body’s annual reports, Felda, at the group level, incurred a net loss of RM1.04 billion for FY14, narrowed by 48% from RM1.99 billion in the immediate preceding year.
These losses have resulted in Felda’s accumulated funds dropping by 16.46% to RM13.47 billion as at FY14, from RM16.12 billion in FY12.
Describing it as a “dire” situation, opposition member of parliament Mohd Rafizi Ramli has been organising a series of press conferences since December last year to highlight Felda’s weak financial position.
Felda has not presented its FY15 audited accounts to Parliament yet.
Based on data available from Bursa Malaysia, Felda has been one of Maybank’s top five shareholders since year 2000 (data prior to that was not available).