PETALING JAYA: OSK Holdings Bhd, which is planning to form a mega property company, has failed to take over PJ Development Holdings Bhd (PJD) at the close of the offer yesterday.
OSK ended up with 89.36% of PJD, hence falling short of the required acceptance level to take the company off Bursa Malaysia.
OSK had 31.03% when it made the offer for PJD’s shares and warrants at RM1.56 and 60 sen each, respectively.
Under the takeover regulations, an offeror needs an acceptance of 90% of the shares that it does not own at the point of making the offer to compulsorily acquire the remaining equity in the company.
For OSK to reach this level, it needed about 93% of total shareholders’ acceptance.
PJD’s public shareholding spread based on the valid acceptances verified and received by the registrar for the takeover offer by OSK yesterday was 10.62%.
However, PJD did not comply with the public shareholding spread requirement of the Main Market listing requirements, which states that at least 25% of its total listed shares (excluding treasury shares) must be owned by public shareholders.
MIDF Research in its recent report opined that the PJD acquisition and the takeover offer were beneficial to OSK and in line with its business strategy to diversify into property development, construction, manufacturing and the trading of cables and building materials, as well as the hotel and leisure business.
MIDF said based on the offer document, it was not the intention of OSK to privatise PJD, unless sufficient valid acceptances were obtained to invoke the compulsory acquisitions as set out in the document.
The trading of OSK Property Holdings Bhd (OSK Prop) will be suspended effective 9am on Oct 22, as its public shareholding spread fell below the 25% requirement set by Bursa Securities.
OSK Prop declared its suspension yesterday in a filing with the stock exchange after its public shareholding only stood at 5.92%.
The group must ensure that at least 25% of its shares are in the hands of public shareholders for Bursa Securities to lift the suspension.
The buyout deals of OSK Prop and PJD had been declared by OSK Holdings chief executive officer and group managing director Tan Sri Ong Leong Huat (pic) last October, as part of his grand plan of creating a mega property company.
It was reported that the offer prices for OSK Prop and PJD shares were 11.9% and 10.1% below what they were trading at.
The buyout price for PJD shares was also at a significant 37% discount to its net asset value per share. The proposed buyout, in which minorities are being offered shares in OSK Holdings or a cash option, naturally sent the shares of OSK Prop and PJD falling, after a notable run-up just weeks before.
If the merger materialises, then the mega property company would have an asset size of RM6bil, shareholders’ funds of RM4.9bil, and a recurring net income of some RM386mil, which is expected to grow to RM410mil in financial year 2015.
