KUALA LUMPUR: The heavy selldown on the broader market has not dampened investor interest in two property development firms — Eastern & Oriental Bhd (E&O) and Malton Bhd.

Both counters were on the list of most actively traded stocks on Monday, Sept 12, with 17.2 million E&O and 13.4 million Malton shares changing hands.

Malton has been linked to E&O amid market talk that the former's major shareholder Datuk Desmond Lim had expressed interest in E&O, which has been granted exclusive land reclamation rights in Penang.

Speculation is rife that Lim, who owns 37.9% equity interest in Malton, may team up with a substantial shareholder of E&O to make a counter bid for the shares in E&O, in which Sime Darby Bhd is currently the single largest shareholder.

Besides the three major shareholders — Tan Sri Wan Azmi Wan Hamzah, E&O co-founder Datuk Terry Tham Ka Hon, who had sold part of their stake to Sime Darby, ECM Libra Financial Group Bhd is also a notable substantial shareholder holding a 6.25% stake in E&O.

E&O's share price gained five sen or 2.5% to RM1.65 against its closing price last Friday. The stock reached an intra-day high of RM1.69. It has gained 13.8% since Sime Darby announced its purchase of a 30% stake in the property firm on Aug 28 for RM766 million cash or RM2.30 per share.

Malton, which is controlled by Lim, closed unchanged at 56 sen after it hit an intra-day high of 59.5 sen, a jump of 6.25% or 3.5 sen from its closing price last Friday.

Hardly traded, Malton started to draw interest late last week. Its trading volume soared to 33 million shares last Thursday, the largest volume the counter has traded in 10 months. Malton has surged 43.5% or 17 sen from the year's low of 39 sen to 56 sen on Monday.

There has been no filing with Bursa Malaysia on Lim emerging as a substantial shareholder in E&O.

The Securities Commission (SC) is currently examining whether Sime Darby's purchase of a 30% equity stake in E&O warrants a mandatory general offer for all other shares.

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