KUALA LUMPUR (Oct 25): The Wen family, which holds a 68.23% stake in Selangor Properties Bhd, is looking to take the company private at RM5.70 per share.

The privatisation will be done through a proposed selective capital reduction and repayment exercise (SCR).

In a filing to Bursa Malaysia today, Selangor Properties said it received a letter from its major shareholder Kayin Holdings Sdn Bhd, which is the vehicle of the Wen family, requesting for the company to undertaken an SCR.

The proposed SCR entails a selective capital reduction and a corresponding capital repayment of RM5.70 per share in Selangor Properties held by all the shareholders (other than Kayin Holdings).

Kayin stated that the SCR of RM5.70 represents a premium ranging from 19.62% against its one-year volume weighted average price (VWAP) and 40.45% against its five-day VWAP — above the prevailing market price of the shares.

It pointed out that Selangor Properties shares have not traded at or above the SCR sum since March 2016, and trading liquidity of the shares has been low.

The proposed SCR is expected to be funded via the company’s internally generated funds and bank facilities obtained by the company. Selangor Properties’ cash balance stood at RM264.2 million and financial assets (including fixed income investment funds) amount to RM702.9 milion.

Under the proposed SCR, the entitled shareholders who hold 109.17 million Selangor Properties shares or the remaining 31.77% stake will receive a total capital repayment of RM622.27 million, which represents a cash repayment of RM5.70 per share.

“In view that the capital reduction is higher than the existing issued share capital of Selangor Properties, a bonus issue is proposed to be undertaken by Selangor Properties to increase the share capital to a level which is sufficient for the capital reduction to facilitate the proposed SCR,” it said.

Selangor Properties' share trade was suspended today. It last closed at RM4.06 yesterday, and for a market capitalisation of RM1.39 billion. Trading of its shares will resume at 9am tomorrow. — theedgemarkets.com

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