KUALA LUMPUR (Nov 28): Public Bank Bhd (KL:PBBANK) has formally extended a conditional mandatory general offer (MGO) for the remaining shares in LPI Capital Bhd (KL:LPI) at RM9.80 sen apiece.
This after the bank's sale and purchase agreement (SPA) with the estate of the late Tan Sri Teh Hong Piow and its private vehicle Consolidated Teh Holdings Sdn Bhd to acquire a 44.15% stake or 175.9 million shares in the insurer for RM1.72 billion cash or RM9.80 sen per share turned unconditional.
“Public Investment Bank Bhd and the vendors (Teh’s estate and Consolidated Teh) had mutually agreed that the SPA has become unconditional on [Thursday],” Public Bank said in a notice filed with Bursa Malaysia. Teh, who passed away in 2022, founded both Public Bank and LPI.
The LPI stake acquisition was passed by Public Bank’s shareholders at an extraordinary general meeting held on Thursday with 99.55% of voting shares in favour of the proposal.
Compared to LPI’s closing price on Thursday of RM13.36, the RM9.80 price tag represents a 36.33% discount.
Public Bank reiterated its intention to maintain the insurer’s listing on the bourse.
Besides Teh’s estate and Consolidated Teh, LPI’s other substantial shareholder is Sompo Japan Insurance Inc, with an 8.54% stake.
According to the notice, the MGO has no ultimate offeror, thus the offer will also be extended to the persons acting in concert (PACs) with Public Bank.
Those deemed PACs are Public Bank managing director and CEO Tan Sri Dr Tay Ah Lek, Tay’s wife Puan Sri Pang Lik Liam @ Cecilia, Tay’s vehicle Lek Holdings Sdn Bhd, director Lee Chin Guan, Lee’s siblings Lee Su San and Lee Su Ching, the brother of director Tham Chai Fhong — Tham Quek Nyap, and Public Bank Group Officers’ Retirement Benefits Fund, according to the notice.
The MGO is conditional upon achieving a minimum acceptance level equivalent to the offeror and PACs holding an aggregate stake of 50%. According to the notice, the PACs own an aggregate 49.56% stake in LPI as at Nov 26 — assuming Public Bank's resultant 44.15% stake in the insurer after the acquisition’s completion.
Shares in LPI ended eight sen or 0.6% higher at RM13.36, giving the insurer a market capitalisation of RM5.29 billion. Public Bank closed three sen or 0.68% lower at RM4.41, valuing the bank at RM85.99 billion.