Widad offer for Ideal Jacobs not fair, not reasonable: Adviser

PETALING JAYA: The unconditional mandatory takeover offer of Ideal Jacobs (Malaysia) Corp Bhd by Widad Business Group Sdn Bhd at 23 sen a share is not fair and not reasonable, according to independent adviser M&A Securities Sdn Bhd.

“Accordingly, M&A Securities recommends that the holders reject the offer. Nonetheless, holders are advised to closely monitor the announcements made by the offeror and market price of Ideal Jacobs shares prior to the closing date before making the decision as to whether to accept or reject the offer,” M&A said in its independent advice circular.

The directors of Ideal Jacobs, after a careful assessment of the terms and conditions of the offer and the evaluation in the independent advice circular, have concurred with the opinion of the independent adviser and advised shareholders to reject the offer.

M&A said the offer price of 23 sen is a discount of between six sen and eight sen, over the estimated fair value per Ideal Jacobs share of between 28.68 sen and 30.60 sen; and a discount of between 7 sen and 26 sen or between 23.33% and 53.06% to the historical market price of Ideal Jacobs shares.

It also noted that the offeror intends to maintain the listing status of Ideal Jacobs on the ACE Market of Bursa Securities, thereby allowing the holders to sell their Ideal Jacobs shares in the open market after the closing date.

The offeror does not intend to invoke the provisions of Section 222(1) of the Capital Markets and Services Act, 2007 to compulsorily acquire any outstanding offer shares; and holders who choose to reject the offer will receive free warrants which will allow them to participate in the potential upside of Ideal Jacobs moving forward.

On Bursa Malaysia yesterday, Ideal Jacobs was down half a sen to 30.5 sen with 258,800 shares changing hands.