KUALA LUMPUR, July 6, 2011 – Boustead Holdings Berhad (BHB), in an effort to comply with listing requirements to pare down its current stake of 97.81% in Pharmaniaga Berhad (Pharmaniaga), will undertake a series of corporate exercises which will have a positive value creation for existing shareholders of BHB and Pharmaniaga.
|The corporate exercises consist of:-|
|1)||a proposed dividend-in-specie of Pharmaniaga shares held by BHB to shareholders of|
|2)||a proposed restricted offer for sale of 16,284,377 Pharmaniaga shares held by BHB to|
|all shareholders of BHB excluding Lembaga Tabung Angkatan Tentera (LTAT)|
|3)||a proposed divestment of 13.5 million Pharmaniaga shares held by BHB for a sale|
|consideration of RM5.75 per Pharmaniaga share to LTAT, BHB Directors and|
|employees as well as identified investors|
|4)||a proposed bonus issue of 94,016,250 bonus shares to shareholders of BHB.|
In conjunction with the above, Pharmaniaga will undertake a proposed bonus issue of 10,697,779 bonus shares to shareholders of Pharmaniaga.
The proposed distribution of a 20% dividend-in-specie, equivalent to 16,018,150 Pharmaniaga shares held by BHB, to existing shareholders of BHB will be on the basis of one Pharmaniaga share for every 57.5 BHB shares held. The gross value of this dividend-in-specie will be in excess of RM94 million, representing RM5.75 per Pharmaniaga share. Shareholders of BHB who hold less than 5,750 BHB shares will receive cash in lieu of their entitlement of Pharmaniaga shares under the proposed dividend-in-specie scheme.
For the proposed restricted offer for sale of 16,284,377 Pharmaniaga shares held by BHB, shareholders of BHB will have the opportunity to invest in Pharmaniaga at a proposed offer price of RM5.75 representing a discount to market based on the last trading price of Pharmaniaga of RM5.90 on June 9, 2011. The basis for this restricted offer for sale to the shareholders of BHB is one Pharmaniaga share for every 24 BHB shares held. Given LTAT’s indirect stake as a substantial shareholder of Pharmaniaga via its controlling shareholding in BHB, LTAT has been excluded from the restricted offer for sale in order to comply with the public shareholding spread for Pharmaniaga and to achieve the objectives of this exercise.
The proposed divestment of 13.5 million Pharmaniaga shares held by BHB to LTAT, BHB Directors and employees as well as identified investors will be at the offer price of RM5.75 per Pharmaniaga share. LTAT will only subscribe to 1.5 million Pharmaniaga shares as part of the proposed divestment. The divestment of shares to BHB Directors is subject to approval from BHB shareholders.
As a result of the proposed restricted offer for sale and the proposed divestment, BHB will raise gross proceeds of up to approximately RM93.6 million from the restricted offer for sale and RM77.6 million from the proposed divestment. The combined proceeds of RM171.2 million will be utilised to pare down BHB’s current gearing.
The proposed BHB bonus issue will see the issuance of 94,016,250 bonus shares on the basis of one bonus share for every 10 existing BHB shares held by the shareholders of BHB. Pharmaniaga will also undertake a bonus issue of up to 10,697,779 bonus shares on the basis of one bonus share for every 10 existing Pharmaniaga shares held by the shareholders of Pharmaniaga. The book closure date for the bonus issue by Pharmaniaga will be after closing of the proposed restricted offer for sale.
YBhg Tan Sri Dato’ Lodin Wok Kamaruddin, Deputy Chairman & Group Managing Director, Boustead Holdings Berhad said, “Based on the annualised earnings per share of Pharmaniaga for the quarter ended March 31, 2011, the proposed offer price represents a price earnings (PE) multiple of 9.9 times. These multiples are clearly within the range of companies trading in the pharmaceutical sector and based on the counsel of our financial advisors, we consider these multiples fair and attractive.”
“As BHB has recently taken management control of Pharmaniaga, we are confident that over the next few quarters of this financial year, we will deliver a better bottom line for Pharmaniaga. Our confidence stems from the fact that with the growth in population in Malaysia, the demand for pharmaceutical products will grow particularly due to the advent of new hospitals, clinics in rural areas, community health clinics and 1Malaysia clinics under the 10th Malaysia plan.”
“Coupled with this, we are confident given that Pharmaniaga will now be part of the LTAT group, the prospect of tapping new business opportunities with hospitals owned by the Ministry of Defence and other ministries will increase,” he added.
Boustead Holdings Berhad
Since its inception as a modest trading entity more than 180 years ago, the Boustead Group has grown by leaps and bounds to comprise more than 90 subsidiary and associate companies, and has substantial interests in various sectors of the Malaysian economy. The Boustead Group’s operations are focused in six key areas; plantation, pharmaceutical, heavy industries, property, finance & investment and trading & manufacturing. As at 31 December 2010, Boustead Holdings Berhad’s paid-up capital was RM470 million, while its shareholders’ funds stood at RM4.2 billion. Market capitalisation is currently in excess of RM5.7 billion.
Forward looking statements
This release may contain certain forward-looking statements with respect to the financial conditions, results of operations and business of the Group and certain plans and objectives of Boustead Holdings Berhad with respect to these items. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.
Issued on behalf of: Boustead Holdings Berhad By: acorn communications sdn bhd
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