KUALA LUMPUR (Aug 6): Some shareholders of Dagang Nexchange Bhd (DNeX) has raised concerns that the RM1.50 per share selective capital reduction (SCR) exercise on its 71.25% subsidiary, Dagang Net Technologies Sdn Bhd (Dagang Net), is too high a price to pay for its minority shareholders.

“The issue is on the valuation — Dagang Net is not a public listed company and is not liquid. The board’s initial adviser valued Dagang Net at RM1.09 per share,” he noted.

In April, DNeX proposed the SCR and repayment exercise to be effected by the cancellation of Dagang Net shares. Both Lembaga Tabung Haji and Bank Islam Malaysia Bhd (BIMB) have a 9.5% stake in DNeX.

Other minority shareholders include trustee for National Chamber of Commerce and Industry of Malaysia Datuk Seri Syed Hussein (5%), as well as Juasa Holdings Sdn Bhd (4.75%).

Poll results by shareholders on the SCR will be announced at 5pm today.

DNeX (fundamental 2.4; valuation: 0.2) stood unchanged at 25 sen, giving it a market capitalisation of RM193.81 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)