Khee San falls 4.69% despite potential mandatory general offer

Khee San falls 4.69% on potential mandatory general offer

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KUALA LUMPUR (Sept 12): Shares in Khee San Bhd fell 4.69% in active trade just before noon today on news that a mandatory general offer could be triggered after it signed a heads of agreement with Wah Kong Corp Sdn Bhd to negotiate the proposed acquisition of equity in one or more of Wah Kong's subsidiaries.

At 11.56am, the sweets and confectionery products manufacturer's share price fell 1.5 sen to 30.5 sen, bringing it a market capitalisation of RM34.82 million. The counter saw some 8.41 million shares changing hands.

Its one-year high was 68 sen while its 52-week low was 16 sen.

Khee San said if the negotiations are successful, the purchase will be satisfied via the issuance and allotment of new Khee San shares at an indicative issue price of 33 sen per share.

"Once the share sale turns unconditional, Wah Kong will become a substantial shareholder of Khee San. And depending on the purchase consideration, Wah Kong may then be required to extend a mandatory takeover offer to acquire the remaining shares in Khee San not already held by itself and persons acting in concert, at the indicative offer price of 33 sen per share," it added.

Khee San also said the businesses of these companies are expected to be complementary and synergistic to the group's existing business in the manufacturing and trading of confectionery and other related foodstuff products.

The subsidiary companies of Wah Kong that Khee San is looking to acquire stakes in are Momentum Strike Sdn Bhd, Yew Fatt Marketing Sdn Bhd, YFM Distributors Sdn Bhd and HC Hin Marketing Sdn Bhd, which are involved in the sale and distribution of pet food products as well as general sale, wholesale, marketing and distribution of household and consumer products.

See also: Khee San in talks to buy pet food distribution business