Jeffrey Cheah: Sunway not a bully, will walk away if IJM bid is rejected

KUALA LUMPUR (Feb 27): Sunway Bhd (KL:SUNWAY) will walk away from its proposed takeover of IJM Corp Bhd (KL:IJM) if the construction group’s shareholders do not accept the offer by the early April deadline.

Sunway Group founder Tan Sri Dr Jeffrey Cheah (pictured) said IJM shareholders are under no obligation to sell and are free to decide whether to accept or reject the deal. If the shareholders reject the deal, Sunway will withdraw the bid and not pursue the acquisition further, he told reporters on Friday.

“There is a lot of noise out there, but I stress that there is no compulsory acquisition. Sunway does not bully or hurt people. This is purely for commercial purposes. We see IJM as an attractive asset, so we made an offer,” he said this after the prospectus launch of Sunway’s healthcare arm.

“There’s no obligation for [IJM] shareholders to sell. If they accept, fine. If they don’t, we walk away. It’s entirely up to them. They just need to decide which boat they want to be on,” he added.

Sunway announced on Jan 12 a cash-and-share offer valued at more than RM11 billion to acquire its rival. If completed, the merged entity would rival Gamuda Bhd (KL:GAMUDA) as Malaysia’s largest construction group by revenue. Under the proposed terms, every 1,000 IJM shares would be exchanged for RM315 in cash and 501 new Sunway shares valued at RM2,835.

The offer was made prior to IJM coming under scrutiny in connection with a probe by the Malaysian Anti-Corruption Commission and the Inland Revenue Board over alleged RM2.5 billion in overseas assets and potential money laundering.

IJM has denied the allegations involving its non-executive chairman Tan Sri Krishnan Tan and company adviser Seow Wah Chong. Tan was detained earlier this month for questioning and released within 24 hours on health grounds.

IJM, a diversified conglomerate with businesses spanning construction, property and infrastructure, has an outstanding order book of RM4.4 billion and RM1.59 billion in unbilled property sales. The group also holds interests in highway concessions, ports and manufacturing.

“If they [IJM shareholders] accept, they will receive Sunway shares and participate in our growth. If they don’t, that’s entirely their choice. It’s a willing buyer, willing seller situation,” Cheah added.

This week, Sunway revised the cash component of its offer following the declaration of a two-sen dividend to Sunway shareholders.

The cash portion will increase from 31.5 sen to approximately 32.5 sen per IJM share, after adjusting for the second interim dividend for the financial year ended Dec 31, 2025. Sunway said the adjustment reflects the net distribution of two sen per Sunway share multiplied by the 0.501 new Sunway shares that each IJM shareholder would receive upon accepting the offer.

Shares of Sunway were 15 sen or 2.52% lower at RM5.80 at the time of writing on Friday, giving the group a market capitalisation of RM39.47 billion.

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