Batu Kawan makes formal offer for remaining CCM shares at RM3.10 each

KUALA LUMPUR (Dec 7): Batu Kawan Bhd today made a formal offer to buy all shares in Chemical Company of Malaysia Bhd (CCM) that it does not already own at RM3.10 per share.

This is the price the group is paying to acquire a 56.32% stake in CCM for RM292.97 million cash from Permodalan Nasional Bhd (PNB).

Upon completion of the acquisition, Batu Kawan’s shareholding in CCM will be increased to 59.73% from 3.41%.

According to the group’s notice of an unconditional mandatory takeover offer, the RM3.10 offer price represents premiums ranging from 2.13% over the five-day volume weighted average market price (VWAMP), and up to 77.88% over the one-year VWAMP, up to the last traded price of the shares of RM3.05 as at last Friday.

CCM has seen a steep climb in its share price since mid-October on news that PNB is mulling to divest its stake in the chemical company.

Since the beginning of October, the stock has risen 148% to the latest share price of RM3.08 from RM1.24 previously. At the current price, the takeover offer price just barely represents a 1% premium.

Batu Kawan confirmed that it had sufficient financial resources to satisfy full acceptance of the offer. It said the offer will not fail due to insufficient financial capability, and that every holder who wishes to accept the offer will be paid fully in cash.

Batu Kawan, which controls Kual Lumpur Kepong Bhd (KLK), said it intends to maintain the listing status of CCM on the Main Market of Bursa Malaysia unless it receives valid acceptances resulting in the company and its associates holding in aggregate 90% or more of the shares.

As at 3.30pm today, shares in Batu Kawan were up four sen or 0.23% at RM17.24, valuing the group at RM6.89 billion. Year to date (YTD), the counter was 1.26% lower from RM17.46, but from this year’s trough of RM11.40, it was up 51%.

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Batu Kawan to buy 56.32% CCM stake from PNB and Amanahraya Trustee for RM292.79 million, MGO at RM3.10 per share