EONCap sequel: EGM on 19 August
Filed Under (Business News) by Webmaster on 28-07-2010
Tagged Under : EGM, eon bank, eon capital, Hong Leong Bank
The board of EON Capital Bhd, owner of Malaysia’s seventh largest bank, will ask shareholders to vote on Hong Leong Bank Bhd’s RM5.06bil (US$1.6bil) takeover offer on Aug 19, according to a statement sent to Bursa Malaysia yesterday.
The move defies EON Cap’s biggest investor which has threatened to seek RM1.11bil in damages if the deal goes through at the current price.
Shareholders are divided over whether to accept an all-cash offer of RM7.30 a share from billionaire Tan Sri Quek Leng Chan’s Hong Leong Bank (HLB).
Primus Pacific Partners Ltd, a Hong Kong-based investment fund, is EON Cap’s biggest shareholder and opposes the deal, having paid RM9.55 a share for its 20% stake in 2008. That’s 31% more, or a difference of RM315mil, based on Bloomberg calculations.
Primus, which has one seat on EON Cap’s board, said it filed a lawsuit against its nine other directors on June 21, claiming they handled HLB’s bid improperly.
The High Court has fixed trial dates from Sept 20 to 28, more than a month after HLB’s offer is scheduled to lapse on Aug 15.
EON Cap rose 0.14% to close at RM6.94 yesterday. The FTSE Bursa Malaysia KLCI rose 0.03%.
HLB was unchanged at RM8.86.
An EON Cap takeover would help Quek create Malaysia’s fourth biggest banking group with assets of about RM121bil.
For the sale to go through, the board needs acceptances from 50% plus 1 share.
Government-owned Khazanah Nasional Bhd, the Employees Provident Fund, businessmen Rin Kei Mei and Tiong Hiew King jointly hold more than 50% of the shares, according to an EON Cap statement on May 21.
HLB’s offer was also dependent on the result of the Primus lawsuit and approval from the Finance Minister, EON said on July 7.
