Friday 29 Mar 2024
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KUALA LUMPUR (Feb 25) ECM Libra Financial Group Bhd's potential mandatory general offer (MGO) by its largest shareholder Lim Kian Onn is priced at 37 sen per share or RM27.45 million for the 74.19 million shares or 25.89% stake, confirming The Edge Financial Daily's (Edge FD) report today.

In a filing with Bursa Malaysia today, ECM Libra said the purchase consideration is 37 sen per share for the 74.19 million shares to be purchased by Plato Capital Ltd's wholly-owned subsidiary, Truesource Sdn Bhd.

Quoting sources, Edge FD reported today that ECM Libra's co-founder Lim will launch an MGO at 37 sen per share to take over the cash-rich listed entity should he manage to buy some 74.19 million shares, or a 25.89% equity stake, from Tan Sri Azman Hashim and K&N Kenanga Holdings Bhd.

Lim's investment vehicle Plato Capital Ltd's unit Truesource entered into a conditional share sale agreement yesterday, with Amcorp Group Bhd, Hikkaya Jaya Sdn Bhd, Arab-Malaysian (CSL) Sdn Bhd and Equity Vision Sdn Bhd, to purchase 74.19 million shares in ECM Libra, according to an announcement to Bursa Malaysia yesterday.

At its last closing price of 33 sen on Feb 23, ECM Libra is valued at 0.22 times its book value per share of RM1.48. It has cash coffers of RM105.38 million or 36.7 sen per share.

ECM Libra also said in the filing today that the conditions precedent of the share sale agreement dated Feb 23, 2016 include resolutions being passed at a general meeting of Plato Capital approving the issuance of redeemable convertible unsecured loan stocks (RCULS) of up to SG$10 million to Lim to raise proceeds for the purchase.

Other condition includes all regulatory approvals being obtained for issuance of the RCULS by Plato Capital Ltd.

It is envisaged that the conditions precedent set out in the share sale agreement would be fulfilled by May 31, 2016.

Meanwhile, in a filing with Singapore Exchange on the matter, Plato said the purchase consideration of 37 sen per share is at a 12.1% premium to ECM Libra's last traded price of 33 sen on Feb 23.

"The proposed shares acquisition offers the company an opportunity to purchase a stake in a business with significant complementary investments in the education and precision engineering sectors," it noted.

Plato said ECM Libra's fund management licence offers significant synergies and strategic relevance relative to the future direction of the company and the group.

The Singapore-listed entity also believes that the proposed shares acquisition is "attractively priced" due to the transaction price of 37 sen per share representing a discount of 22.9% to ECM Libra's announced consolidated net asset value as at Oct 31, 2015 of RM1.48 adjusted for the completed distribution of cash and securities amounting to approximately RM1 per share to ECM Libra's shareholders as announced on Nov 4, 2015.

Lim is a director and substantial shareholder of ECM Libra and Plato. He currently holds a 24.37% stake or 69.84 million shares in ECM Libra.

ECM Libra shares have been suspended from trading since yesterday until 12.30pm today. The counter will resume trading at 2.30pm today.

 

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