This article first appeared in The Edge Financial Daily on February 15, 2019

KUALA LUMPUR: Selangor Properties Bhd (SPB) has received the go-ahead from shareholders for it to be taken private, after approving the selective capital reduction (SCR) and repayment exercise launched by the Wen family, who owns a 68.23% stake in the company.

Based on poll results at the extraordinary general meeting (EGM) here yesterday, SPB said 76.301% of its disinterested shareholders, representing 99.023% in value of the total disinterested votes, voted for the plan.

“Further, 0.374% of the votes attached to all the disinterested shares of the total voting shares of SPB voted against the special resolution. Therefore, the special resolution has been carried,” SPB said in a filing to Bursa Malaysia yesterday.

The special resolution required approval from at least a majority of the company’s disinterested shareholders, or 75% in value. Additionally, it must also not be voted against by more than 10% of SPB’s total shareholders.

SPB officials declined to speak to the media at the EGM yesterday.

To recap, on Oct 25, 2018, the Wen family, via its private investment vehicle, Kayin Holdings Sdn Bhd, offered to take the group private at RM5.70 per share via an SCR and repayment exercise.

While Kayin stated that the SCR of RM5.70 represents a premium to the prevailing market price of the thinly-traded SPB shares, dissenting voices among shareholders regarding the offer price led to Kayin upping its offer price twice, first by 30 sen to RM6 per share last December, then to RM6.30 in January this year.

Consequently, entitled shareholders will be receiving capital repayment amounting to RM687.77 million.

“In view that the issued share capital to be reduced is higher than the existing issued share capital of SPB of RM545.37 million, SPB will undertake a bonus issue of up to 382.09 million bonus shares by way of capitalising up to RM382.09 million from the retained earnings of the company, in order to increase the share capital of SPB to a level which is sufficient for the capital reduction,” SPB said earlier.

Shares in SPB rose four sen yesterday to finish at RM6.20, translating into a 52.7% gain from its last price of RM4.06 prior to the October announcement.

Founded in 1963 by the late Tan Sri Wen Tien Kuang and his spouse, the late Puan Sri Chook Yew Chong Wen, SPB currently has a market value of RM2.13 billion.

Following Chook’s retirement in December 2017, Wen Chiu Chi, the third of the couple’s four children, succeeded her as executive chairperson. He was previously the managing director (MD).

One notable development under Chiu Chi’s helm as MD was the AIRA Residences, a luxury condominium project that marked the return of SPB to Malaysia’s property scene in 2016.