KUALA LUMPUR (Dec 4): Public Bank Bhd (KL:PBBANK) said on Wednesday it has completed the acquisition of 175.9 million shares, representing a 44.15% stake, in insurer LPI Capital Bhd (KL:LPI).

Public Bank inked a conditional sale and purchase agreement on Oct 10 with the estate of the late Tan Sri Teh Hong Piow and its private vehicle Consolidated Teh Holdings Sdn Bhd to purchase the stake at RM9.80 per share, or RM1.72 billion, cash. The RM9.80 price tag values LPI at 1.71 times its book value and 12.41 times its 2023 earnings.

The LPI stake acquisition was approved by Public Bank’s shareholders at an extraordinary general meeting held on Nov 28, with 99.55% of voting shares in favour of the proposal.

On the same day, Public Bank formally extended a conditional mandatory general offer (MGO) for the remaining shares in LPI at RM9.80 sen apiece. 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 equivalent to the offeror and PACs holding an aggregate stake of 50%. At present, Public Bank and the PACs own an aggregate 49.56% stake in LPI.

Public Bank intends to maintain the listing status of LPI Capital.

Besides Teh’s estate and Consolidated Teh, LPI’s other substantial shareholders include Public Mutual Bhd with a 9.41% stake and Sompo Japan Insurance Inc, with 8.54%.

Shares in LPI closed two sen or 0.2% higher at RM13.14 on Wednesday, valuing the insurer at RM5.24 billion. Public Bank settled two sen or 0.4% higher at RM4.53, valuing the bank at RM87.93 billion.