Batu Kawan’s Whitmore completes first MKH tranche under RM2 offer structure

PETALING JAYA (June 3): Batu Kawan Bhd’s wholly owned subsidiary Whitmore Holdings Sdn Bhd has completed the first tranche of its acquisition of shares in MKH Bhd via a direct business transaction (DBT), as part of a proposed conditional mandatory take-over offer at RM2 per share.

According to a press notice issued by Maybank Investment Bank Bhd on behalf of Batu Kawan, last Thursday (May 28), Whitmore is acquiring 170.44 million MKH shares, representing 29.6% equity interest in MKH excluding treasury shares, for RM2 per share in cash, alongside a proposed acquisition of a further 104.43 million shares, or 18.1%, at the same price.

In its Bursa filings, it said these transactions will be followed by a proposed conditional mandatory take-over offer for all remaining MKH shares not already held by Whitmore, Batu Kawan and persons acting in concert with them, also at RM2 per share. The parties have agreed to complete the initial 170.44 million-share acquisition in two DBT tranches.

The first tranche of 148.74 million MKH shares was effected on May 28 for RM297.49 million, while the second tranche of 21.7 million shares is to be completed within 30 days from the date of the share sale agreement. Following the first tranche, Whitmore directly holds 148.74 million MKH shares, representing a 25.79% interest in MKH.

On the plantation side, Whitmore has also completed the acquisition of MKH Oil Palm (East Kalimantan) Bhd shares via direct business transaction (DBT) for a total consideration of RM25.37 million at a revised price of 64.8 sen per share, after the consideration was adjusted from 64.78 sen to comply with Bursa Malaysia Securities’ DBT rules.

MKH’s Bursa filings last friday (May 29) show that Chen Choy & Sons Realty Sdn Bhd disposed of 19.28 million MKH shares held directly and 129.47 million shares held indirectly via nominee accounts to Whitmore through the DBT on May 28.

After the disposal, Chen Choy & Sons Realty’s direct interest stood at 65.88 million shares, or 11.42%, with an indirect interest of 21.7 million shares, or 3.76%. Separate director’s interest and substantial shareholder filings by Tan Sri Chen Kooi Chiew @ Cheng Ngi Chong, Tan Sri Chen Lok Loi and Datuk Chen Fook Wah each recorded the same 148.74 million-share disposal as an indirect interest, reflecting their deemed interests in Chen Choy & Sons Realty.

MKH also filed notices of dealings outside the closed period for the three directors, each reflecting the disposal of 148.74 million shares at RM2 per share for RM297.49 million. In an earlier notice of interest dated May 22,

Whitmore disclosed a deemed interest in 274.88 million MKH shares, or 47.658%, arising from an unconditional share sale agreement with Chen Choy & Sons Realty for 170.44 million shares and a conditional share sale agreement with Chen Choy & Sons Realty and related Chen family entities for a further 104.43 million shares.

Completion of the conditional acquisition is subject, among others, to Batu Kawan shareholders’ approval for the acquisition of the additional shares and the resulting mandatory general offer.

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