KUALA LUMPUR (Feb 23): Perak Corp Bhd has decided not to sell its 47.34 million shares or a 15.74% equity interest in Integrax Bhd to Tenaga Nasional Bhd (TNB), unless the utility giant ups its offer price by 50 sen per Integrax share to RM3.25.

The latest move poses another stumbling block to TNB’s (fundamental: 1.3; valuation: 1.8) plan to take over the port operator, whose substantial shareholder and deputy chairman Amin Halim Rasip had earlier rejected the RM2.75 offer price by TNB, saying it undervalues Integrax and that the real value of the company should be more than RM5 per share.

Amin currently holds a 23.78% direct and indirect stake in Integrax.

TNB, which owns 22.12% of Integrax, has offered to buy out the rest of the shares it does not own in Integrax (fundamental: 1.65; valuation: 0.6) at RM2.75 per share.

"The board of Perak Corp has resolved to reject the take-over offer," said Perak Corp in a filing with Bursa Malaysia today.

"However, the board is prepared to recommend to its shareholders to approve the acceptance of a revised take-over offer, in a general meeting, if TNB revises the offer price to RM3.25 per Integrax share, being the highest value in the indicative equity valuation range by Affin Hwang Investment Bank Bhd (its adviser to the offer)," it added.

Perak Corp (fundamental: 1.9; valuation: 1.2) said its decision took into taken into consideration the recommendation by M&A Securities Sdn Bhd, the independent adviser of Integrax, which had last week advised shareholders to reject TNB's takeover offer, describing it as “not fair” but “reasonable”.

It also took the views of Affin Hwang IB which had derived an indicative equity valuation range of between RM2.98 and RM3.25 per Integrax share.

Integrax shares closed unchanged at RM2.81 today, bringing a market capitalisation of RM845.26 million. TNB's share price also closed unchanged at RM14.16, while Perak Corp's counter was down 0.7% to settle at RM2.83.

(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.)