Written by Joseph Chin of theedgemalaysia.com
Friday, 29 April 2011 20:14
KUALA LUMPUR: EON CAPITAL BHD [] said the board of directors had secured the additional payment of RM311.9 million after much negotiations with HONG LEONG BANK BHD [] (HL Bank).
EONCap chairman Gooi Hoe Soon said on Friday, April 29 the directors intended to manage this transaction fairly and equitably to all parties concerned, especially enhancing shareholders value for all shareholders.
“The additional interim dividend payment is in addition to the offer price of RM5.06 billion and was secured after much negotiation with Hong Leong Bank, and we’re pleased with the result,” he said.
EONCap announced on Friday that EON Bank Bhd has proposed a dividend of RM311.94 million, translating into 44.9 sen per share, but to be paid to its parent, EONCap.
The proposed interim dividend was a surprise when EONCap announced to Bursa Malaysia early Friday it had accepted HL Bank’s offer of RM5.06 billion or RM7.30 per share.
EONCap also said HL Bank confirmed it had no objection to EON Bank Bhd declaring and paying the interim net dividend upon receipt of the approval from Bank Negara Malaysia.
EONCap announced on Friday it had accepted HL Bank’s offer to acquire the entire assets and liabilities of EONCap for RM5.06 billion following a High Court decision on Thursday which dismissed a petition filed by Primus (Malaysia) Sdn Bhd which had opposed the takeover.
The transaction, when completed, which will result in Hong Leong Bank becoming the fourth largest banking group in Malaysia, had earlier been approved by a majority of EONCap shareholders who had passed a resolution in favour of the move at EONCap’s EGM in September 2010.
Shareholders’ approval had been subject to a final decision being made by the High Court which has now dismissed the petition by Primus with costs.
In the latest development, Primus had on Friday served on EONCap’s solicitors a notice of appeal to the Court of Appeal. The move was to appeal against the decision of the High Court handed down on Thursday.
On the interim net dividend of RM311.9 million subject to the approval from Bank Negara Malaysia, Gooi said HL Bank had agreed to the interim dividend payment not being deducted from its offer price.
“The directors intend to manage this transaction in a manner that is fair and equitable to all parties concerned, especially enhancing shareholders value for all shareholders,” he said.
Gooi said EONCap believed all stakeholders would be well-served by this move which would see the enlarged entity not only become a larger banking group with total assets in excess of RM140 billion “but it shall also be a stronger force in the regional banking arena.”
Gooi said that this move was also in line with the ongoing consolidation of the banking industry in the country and the boards of both banks will collaborate to achieve a successful transition.
“EONCap’s solid foundation has been built on developing close relationships with our employees and customers, coupled with in-depth knowledge of the local market and core business segments. It goes without saying that our performance particularly in recent years has been due to the integrated effort of a strong team of people who have done good work for the Bank.”
“We are also making every effort to ensure that the transition will have minimum impact on our employees and customers by making it as smooth as possible,” he said.
Showing posts with label Eon capital. Show all posts
Showing posts with label Eon capital. Show all posts
Thursday, 5 May 2011
Tuesday, 18 May 2010
Credit Suisse says HLB's offer price for EON Cap too low
Tuesday May 18, 2010
Credit Suisse says HLB's offer price for EON Cap too low
By RISEN JAYASEELAN
PETALING JAYA: Credit Suisse Securities (M) Sdn Bhd has deemed Hong Leong Bank Bhd's (HLB) offer price for the assets and liabilities of EON Capital Bhd (EON Cap) too low.
This has put the board of directors of EON Cap in a quandary, sources said. EON Cap's board met yesterday to discuss Credit Suisse's opinion on the offer.
The board had requested for its shares to be suspended from trading, pending an announcement related to the offer.
EON Cap said late yesterday evening that its board meeting had been adjourned “pending further clarification from independent financial adviser Credit Suisse.”
But a party familiar with the deal said with Credit Suisse telling the board that the offer was too low, the board has been put in a tough spot as to what to tell shareholders.
“The board had already said it was going to present the offer to shareholders. Does it now also tell shareholders not to accept the offer?” Sources say the situation is tenuous because HLB has no intention of raising its bid.
From its due diligence of EON Cap, HLB may be inclined to ask EON Cap to make some additional provisioning as a condition to the deal, stemming from what it (HLB) deems as unrecoverable loans.
This could mean that the price HLB is willing to pay for EON Cap may be lower than the RM7.20 per share it last made.
EON Cap is said to be disappointed that HLB has not recognised certain deferred tax assets in its valuation of the former, sources say.
HLB's offer is also priced at around 1.4 times the book value of EON Bank, which some analysts deem as low in light of other banking merger and acquisitions done at higher multiples.
The bottom line is that at present, HLB's offer is the only one on the table for EON Cap's shareholders.
Current market conditions are likely to make it difficult for other bidders, such as Affin Bank Bhd, to raise funds to acquire EON Cap.
If this deal falls through, the next bidder for EON Cap may no longer have the luxury of having a lower threshold of shareholder approval for the deal to go through.
http://biz.thestar.com.my/news/story.asp?file=/2010/5/18/business/6282935&sec=business
Related:
Comparative analysis of Malaysian Banking Stocks (16.5.2010)
Credit Suisse says HLB's offer price for EON Cap too low
By RISEN JAYASEELAN
PETALING JAYA: Credit Suisse Securities (M) Sdn Bhd has deemed Hong Leong Bank Bhd's (HLB) offer price for the assets and liabilities of EON Capital Bhd (EON Cap) too low.
This has put the board of directors of EON Cap in a quandary, sources said. EON Cap's board met yesterday to discuss Credit Suisse's opinion on the offer.
The board had requested for its shares to be suspended from trading, pending an announcement related to the offer.
EON Cap said late yesterday evening that its board meeting had been adjourned “pending further clarification from independent financial adviser Credit Suisse.”
But a party familiar with the deal said with Credit Suisse telling the board that the offer was too low, the board has been put in a tough spot as to what to tell shareholders.
“The board had already said it was going to present the offer to shareholders. Does it now also tell shareholders not to accept the offer?” Sources say the situation is tenuous because HLB has no intention of raising its bid.
From its due diligence of EON Cap, HLB may be inclined to ask EON Cap to make some additional provisioning as a condition to the deal, stemming from what it (HLB) deems as unrecoverable loans.
This could mean that the price HLB is willing to pay for EON Cap may be lower than the RM7.20 per share it last made.
EON Cap is said to be disappointed that HLB has not recognised certain deferred tax assets in its valuation of the former, sources say.
HLB's offer is also priced at around 1.4 times the book value of EON Bank, which some analysts deem as low in light of other banking merger and acquisitions done at higher multiples.
The bottom line is that at present, HLB's offer is the only one on the table for EON Cap's shareholders.
Current market conditions are likely to make it difficult for other bidders, such as Affin Bank Bhd, to raise funds to acquire EON Cap.
If this deal falls through, the next bidder for EON Cap may no longer have the luxury of having a lower threshold of shareholder approval for the deal to go through.
http://biz.thestar.com.my/news/story.asp?file=/2010/5/18/business/6282935&sec=business
Related:
Comparative analysis of Malaysian Banking Stocks (16.5.2010)
Sunday, 16 May 2010
A quick look at Eon Capital (15.5.2010)
A quick look at Eon Capital (15.5.2010)
http://spreadsheets.google.com/pub?key=tSgfLNvcIzSMhLmOD_nYDcQ&output=html
Tuesday, 26 January 2010
Hong Leong's offer undervalues EONCap: Chairman
Hong Leong's offer undervalues EONCap: Chairman
By Chong Pooi Koon
Published: 2010/01/26
EON Capital has sought clarification from Hong Leong 'on a range of details' in its buyout proposal, particularly on the valuation.
EON Capital Bhd (EONCap)(5266), which must decide on Hong Leong Bank Bhd's takeover offer by tomorrow, may try to remove the clause that restricts it from talking to other potential bidders while asking for a higher price.
EONCap, the smaller of the two banks, said it has yesterday sought clarification from Hong Leong "on a range of details" in its buyout proposal, particularly on the valuation.
"The board (of directors) is evaluating this approach, but on the face of it the offer price significantly undervalues EONCap," chairman Tan Sri Syed Anwar Jamalullail said in a statement yesterday.
Hong Leong, the sixth largest local bank, last Thursday said it will offer RM7.10 cash per share to take over EONCap. The offer priced EONCap at 1.4 times book value, which falls in the lower end of the past valuations range in local banking deals.
Still, many banking analysts feel that the price offered was fair given EONCap's weaker franchise, though others argued that scarcity premiums should be attached as there are not many local lenders left available for a takeover.
Hong Leong has also set strict conditions in its proposal, one of which requires EONCap to deal with it exclusively on the sale.
"In evaluating the Hong Leong Bank offer, we will consider all alternatives open to us in order to fulfil our responsibility to shareholders," Syed Anwar said yesterday.
Meanwhile, EON Banking Group chief executive officer Michael Lor was quoted by Bernama news agency as saying that EONCap's board was also looking into other offers as there were interested parties.
"If there are better opportunities, why not pursue all the alternatives?" he told reporters in Petaling Jaya yesterday. Lor, however, said that he did not know whether other banks had submitted their applications to Bank Negara Malaysia to participate in the negotiations.
EONCap said it had launched a three-year transformation programme in October 2007, which sharply improved the bank's performance despite difficult economic conditions in 2009.
"In the past year, we have seen our transformation programme succeeding. As Malaysia emerges from the economic downturn, EONCap is well positioned for future value creation," Syed Anwar said.
By Chong Pooi Koon
Published: 2010/01/26
EON Capital has sought clarification from Hong Leong 'on a range of details' in its buyout proposal, particularly on the valuation.
EON Capital Bhd (EONCap)(5266), which must decide on Hong Leong Bank Bhd's takeover offer by tomorrow, may try to remove the clause that restricts it from talking to other potential bidders while asking for a higher price.
EONCap, the smaller of the two banks, said it has yesterday sought clarification from Hong Leong "on a range of details" in its buyout proposal, particularly on the valuation.
"The board (of directors) is evaluating this approach, but on the face of it the offer price significantly undervalues EONCap," chairman Tan Sri Syed Anwar Jamalullail said in a statement yesterday.
Hong Leong, the sixth largest local bank, last Thursday said it will offer RM7.10 cash per share to take over EONCap. The offer priced EONCap at 1.4 times book value, which falls in the lower end of the past valuations range in local banking deals.
Still, many banking analysts feel that the price offered was fair given EONCap's weaker franchise, though others argued that scarcity premiums should be attached as there are not many local lenders left available for a takeover.
Hong Leong has also set strict conditions in its proposal, one of which requires EONCap to deal with it exclusively on the sale.
"In evaluating the Hong Leong Bank offer, we will consider all alternatives open to us in order to fulfil our responsibility to shareholders," Syed Anwar said yesterday.
Meanwhile, EON Banking Group chief executive officer Michael Lor was quoted by Bernama news agency as saying that EONCap's board was also looking into other offers as there were interested parties.
"If there are better opportunities, why not pursue all the alternatives?" he told reporters in Petaling Jaya yesterday. Lor, however, said that he did not know whether other banks had submitted their applications to Bank Negara Malaysia to participate in the negotiations.
EONCap said it had launched a three-year transformation programme in October 2007, which sharply improved the bank's performance despite difficult economic conditions in 2009.
"In the past year, we have seen our transformation programme succeeding. As Malaysia emerges from the economic downturn, EONCap is well positioned for future value creation," Syed Anwar said.
Monday, 25 January 2010
EON Cap reviewing HL Bank offer
EON Cap reviewing HL Bank offer
Written by Darlene Liew
Monday, 25 January 2010 12:18
KUALA LUMPUR: EON Bank chief executive officer Michael Lor says EON CAPITAL BHD [] board is still reviewing HONG LEONG BANK BHD []'s RM7.10 share offer.
He said on Monday, Jan 25 that the board should be making announcement in a few days to meet the deadline of seven days set by Hong Leong Bank earlier.
Hong Leong Bank had on Jan 21 announced it was offering RM7.10 per share to acquire EONCap, which owns EON Bank Bhd.
The offer, to be fully satisfied in cash, translates to 1.4 times book valued based on a shareholders’ fund of RM3.49 billion as at Sept 30, 2009.
http://www.theedgemalaysia.com/business-news/158277-flash-eon-cap-reviewing-other-offers.html
Written by Darlene Liew
Monday, 25 January 2010 12:18
KUALA LUMPUR: EON Bank chief executive officer Michael Lor says EON CAPITAL BHD [] board is still reviewing HONG LEONG BANK BHD []'s RM7.10 share offer.
He said on Monday, Jan 25 that the board should be making announcement in a few days to meet the deadline of seven days set by Hong Leong Bank earlier.
Hong Leong Bank had on Jan 21 announced it was offering RM7.10 per share to acquire EONCap, which owns EON Bank Bhd.
The offer, to be fully satisfied in cash, translates to 1.4 times book valued based on a shareholders’ fund of RM3.49 billion as at Sept 30, 2009.
http://www.theedgemalaysia.com/business-news/158277-flash-eon-cap-reviewing-other-offers.html
Tuesday, 22 December 2009
Hong Leong may yet seal EONCap deal
Hong Leong may yet seal EONCap deal
By Chong Pooi Koon
Published: 2009/12/22
Hong Kong-based Primus Pacific Partners may not be fond of Hong Leong's bid but its options appear limited
HONG Leong Bank Bhd (5819) may see through its deal to buy smaller rival EON Capital Bhd (EONCap), even without unanimous support from the latter's fragmented shareholders, analysts said.
Primus Pacific Partners Ltd, a Hong Kong-based investment firm that had paid RM9.55 per share for its 20.2 per cent stake in EONCap last year, may not be fond of Hong Leong's bid but its options appear limited.
Primus will need a high price to exit, but Hong Leong, controlled by shrewd investor Tan Sri Quek Leng Chan, is not known to overpay in deals.
"It will be tough for Primus. It's an uphill struggle for them," a banking analyst said.
Despite it being the single largest EONCap shareholder, Primus could be easily eclipsed by other major shareholders whose stakes, when added up, are way bigger.
It is believed that Tan Sri Tiong Hiew King, who holds a 16.3 per cent stake in EONCap, and Singaporean businessman Rin Kei Mei, with another 11.1 per cent, are ready to talk to Hong Leong.
Combined with Khazanah Nasional Bhd's 10 per cent stake, they will together control 37 per cent of EONCap, which is more than sufficient to trigger a general offer for the remaining shares, HwangDBS Vickers Research noted.
The Employees Provident Fund owns another 11.9 per cent of EONCap.
"Let's not forget about the minority shareholders who have roughly 30 per cent combined. This is a good exit strategy for them as they will never see a price as high as RM9.55 as Primus had paid," another analyst said, who estimated that a price of slightly above RM7 per share could be fair for "everybody except Primus".
Shares of EONCap jumped 4.6 per cent yesterday to close at RM6.88, retreating from an earlier gain in the day.
Hong Leong Bank could opt to buy EONCap's assets and liabilities under the takeover rules, where it would only need 50 per cent plus one EONCap share vote by value for the deal to go through, HwangDBS said.
This will be a less messy structure and Hong Leong will not need to worry about Primus being the deal breaker.
Primus also lacks a strong bargaining chip. While a merger could give Hong Leong greater scale and size to meet its aspirations as a regional player, it is likely to walk away and focus on building growth elsewhere if the price is expensive.
Hong Leong has already made solid forays into China and Vietnam, while it is eyeing to enter Indonesia and Thailand.
"These options in high growth, higher margin countries will be better bets for success for Hong Leong," HwangDBS said.
http://www.btimes.com.my/Current_News/BTIMES/articles/ionn/Article/index_html
By Chong Pooi Koon
Published: 2009/12/22
Hong Kong-based Primus Pacific Partners may not be fond of Hong Leong's bid but its options appear limited
HONG Leong Bank Bhd (5819) may see through its deal to buy smaller rival EON Capital Bhd (EONCap), even without unanimous support from the latter's fragmented shareholders, analysts said.
Primus Pacific Partners Ltd, a Hong Kong-based investment firm that had paid RM9.55 per share for its 20.2 per cent stake in EONCap last year, may not be fond of Hong Leong's bid but its options appear limited.
Primus will need a high price to exit, but Hong Leong, controlled by shrewd investor Tan Sri Quek Leng Chan, is not known to overpay in deals.
"It will be tough for Primus. It's an uphill struggle for them," a banking analyst said.
Despite it being the single largest EONCap shareholder, Primus could be easily eclipsed by other major shareholders whose stakes, when added up, are way bigger.
It is believed that Tan Sri Tiong Hiew King, who holds a 16.3 per cent stake in EONCap, and Singaporean businessman Rin Kei Mei, with another 11.1 per cent, are ready to talk to Hong Leong.
Combined with Khazanah Nasional Bhd's 10 per cent stake, they will together control 37 per cent of EONCap, which is more than sufficient to trigger a general offer for the remaining shares, HwangDBS Vickers Research noted.
The Employees Provident Fund owns another 11.9 per cent of EONCap.
"Let's not forget about the minority shareholders who have roughly 30 per cent combined. This is a good exit strategy for them as they will never see a price as high as RM9.55 as Primus had paid," another analyst said, who estimated that a price of slightly above RM7 per share could be fair for "everybody except Primus".
Shares of EONCap jumped 4.6 per cent yesterday to close at RM6.88, retreating from an earlier gain in the day.
Hong Leong Bank could opt to buy EONCap's assets and liabilities under the takeover rules, where it would only need 50 per cent plus one EONCap share vote by value for the deal to go through, HwangDBS said.
This will be a less messy structure and Hong Leong will not need to worry about Primus being the deal breaker.
Primus also lacks a strong bargaining chip. While a merger could give Hong Leong greater scale and size to meet its aspirations as a regional player, it is likely to walk away and focus on building growth elsewhere if the price is expensive.
Hong Leong has already made solid forays into China and Vietnam, while it is eyeing to enter Indonesia and Thailand.
"These options in high growth, higher margin countries will be better bets for success for Hong Leong," HwangDBS said.
http://www.btimes.com.my/Current_News/BTIMES/articles/ionn/Article/index_html
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