KUALA LUMPUR: Tecnic Group Bhd said it is not aware of any previously undisclosed corporate development, rumours or possible explanations which could account for the recent sharp rise in its share price.
The plastic products manufacturer’s announcement yesterday came after it was issued with an unusual market activity (UMA) query by Bursa Malaysia yesterday.
Its share price jumped 25.85% or 19 sen yesterday to reach 92.5 sen, after about 7.2 million shares changed hands. The price gives Tecnic (fundamental: 2.8; valuation: 3) a market capitalisation of RM37.37 million.
Technic’s share price has been climbing rapidly in the last week, ahead of its distribution-in-specie of SKP Resources Bhd shares, following the special dividend ex-date last Thursday.
The company’s share price reached the upper limit threshold last Thursday and Friday, which prompted a momentary freeze of its shares’ trading price.
The company had earlier announced a corporate exercise which involves the distribution of 172.09 million SKP Resources (fundamental:2.1; valuation: 1.1) shares held by Tecnic to Tecnic shareholders, on the basis of 4.26 SKP Resources shares for every one Tecnic share held.
It is also distributing RM94.93 million in cash proceeds and a RM11.7 million repayment received from the takeover by SKP Resources to shareholders, on the basis of RM2.64 for every one Tecnic share held.
SKP Resources had proposed to acquire sister company Tecnic’s entire business in October last year for RM200 million. The acquisition was officially completed early this month.
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. Go to www.theedgemarkets.com for more details on a company’s financial dashboard.
This article first appeared in The Edge Financial Daily, on April 29, 2015.