KUALA LUMPUR (Jan 16): The Wen family, with a controlling 68.23% stake in Selangor Properties Bhd, has sweetened its takeover offer for the property development company for the second time, upping by another 30 sen to RM6.30 per share.

In October last year, the Wen family, via its private investment vehicle Kayin Holdings Sdn Bhd, offered to take the group private at RM5.70 per share via a selective capital reduction (SCR) and repayment exercise. It then raised its offer by 30 sen to RM6 per share in December.

In a filing with Bursa Malaysia yesterday, Selangor Properties said it had received a letter from Kayin to revise the SCR offer price to RM6.30 from RM6 per share.

The SCR of RM6.30 represents a premium from 32.21% against its one-year volume weighted average price (VWAP) to 55.24% against its five-day VWAP — above the prevailing share price of Selangor Properties.

Selangor Properties shares have risen 50% since the privatisation offer was announced on Oct 25 last year. Its shares, which closed at RM4.06 on Oct 24, 2018, surged as much as 33% to RM5.38 on Oct 29.

Yesterday, its shares closed at a record high of RM6.07, with a market capitalisation of RM2.09 billion.

Selangor Properties owns several plots of prime land and office buildings in Damansara Heights and Bukit Tunku here. The 25-storey Menara Milenium in Damansara Heights, one of its priciest properties, fetched a market value of RM345 million as of Oct 31, 2018. However, this was lower than its book value recognised for the asset of RM363.16 million, thus resulting in a revaluation deficit of RM18.16 million.

Kayin had said then the privatisation plan comes amid a subdued property investment and development landscape.

Notably, Kayin’s shareholding in the group has not budged since the privatisation offer, indicating minority shareholders are unwilling to part with their shares although the privatisation offer has been revised upwards twice.

Credit Suisse AG, ValueCAP Sdn Bhd and Pangolin Investment Management are listed as shareholders in Selangor Properties’ 2017 annual report.

This article first appeared in The Edge Financial Daily, on Jan 16, 2019.

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