KUALA LUMPUR (Jan 28): Shares of Can-One Bhd fell 3.6% this morning on renewed concerns of its mandatory general offer (MGO) for the remaining 66.61% stake in Kian Joo Can Factory Bhd it does not own.

As at 10.50am, Can-One fell 10 sen to RM2.68. The stock was the top loser on the local bourse.

Can-One's proposed MGO was first announced back in December when the company said it had signed a conditional share sale agreement with Tan Kim Seng to buy his 0.49% stake in Kian Joo for a cash consideration of RM6.71 million or RM3.10 per share, a hefty 51% premium to its five-day volume weighted average price.

Upon completion of the proposed acquisition, Can-One would see its shareholding in Kian Joo increase to 33.39% and would thus be obliged to extend an MGO for the remaining stake.

The Edge Weekly in its cover story dated Jan 28 said all eyes are on Can-One's upcoming extraordinary general meeting slated for Feb 14 as to whether the company can convince minority shareholders to give the green light for the MGO.

It also quoted analysts as expressing negative views on the MGO, who cited concerns that while the purchase presents an opportunity for expansion, it would increase Can-One's net gearing to 2.19 times from 0.51 times as it would have to borrow to fund the acquisition.