By BUSINESS TIMES
EASTERN & Oriental Bhd (E&O), a construction and property group, plans to take its property arm private in an all-share deal worth some RM609 million.
It also plans to take shares of E&O Property Development Bhd (EOPD) off the stock market.
“The E&O board is of the opinion that the streamlining of E&O and EOPD into a single listed entity, as opposed to the current two-tier listing, will provide a strengthened base for sustainable value creation and long-term growth for the entire group,” it said in a statement to Bursa Malaysia yesterday.
E&O now holds 63 per cent of EOPD. It offered to swap the remaining 243.82 million shares, or 37 per cent of EOPD, with new shares of E&O.
There will be 268.2 million new E&O shares, priced at RM2.27 apiece. The exchange will be at a ratio of 1,100 new E&O shares for every 1,000 EOPD shares.
There will be two other options if minorities of EOPD do not want to subscribe to the share swap entirely.
“E&O will make available or source for a cash pool of about RM213 million and afford a fixed combination option and maximised cash option to the EOPD MIs.
To illustrate these options, E&O gave an indicative value of RM2,500 per 1,000 EOPD shares.
Under the fixed combination option, EOPD minorities will get 715 new E&O shares and RM875 cash in exchange for every 1,000 EOPD shares.
Minorities may get more cash from the maximised cash option. Under this, the cash amount may be higher and it will not be less than RM875 for every 1,000 EOPD MI shares.