Kayin plans to take SPB private

KUALA LUMPUR: Selangor Properties Bhd’s (SPB) major shareholder, Kayin Holdings Sdn Bhd, has proposed to take the company private following the suppressed property market in the past few years.

Kayin, the vehicle of the Wen family who owns a 68.23 per cent stake in SPB, planned to privatise SPB through a selective capital reduction (SCR) and repayment exercise.

The company had submitted the offer to the SPB board, said Kayin in a filing with Bursa Malaysia yesterday.

“The residential and non-residential markets have continued to decline in the second quarter. The property market is expected to remain subdued due to the prevalent oversupply of unsold residential properties, office spaces and shopping complexes.

“The oversupply of high-rise residential properties is acute. The number of unsold high-rise residential properties, combined with the oversupply of commercial properties and new developments around SPB’s existing properties will not only drive vacancy rates high and depress effective rental rates of its existing investment properties but will also limit the group’s development activities in the short to medium term,” it said.

Kayin believes the proposed SCR represented a good opportunity for all the shareholders to monetise their investment at a cash repayment of RM5.70 per SPB share. The indicative price comes at a premium of between 19.62 and 40.45 per cent above its prevailing market price.

Kayin said under the proposed SCR, the entitled shareholders who collectively hold 109.17 million SPB shares would receive a total capital repayment of RM622.27 million.

SPB has an issued share capital of RM545.37 million comprising 343.62 million shares. Pursuant to the proposed SCR, the company’s issued share capital will be reduced by RM622.27 million.