Green light for San Miguel to buy Esso stake

PETALING JAYA: Esso Malaysia Bhd has obtained the green light from the Government to have its 175.5 million ordinary shares, or 65% stake, sold by ExxonMobil International Holdings Inc to Philippine-based conglomerate San Miguel Corp.

In an announcement to Bursa Malaysia, the oil refining and marketing company said the letters of approval from the International Trade and Industry Ministry and the Domestic Trade, Cooperatives and Consumerism Ministry (MDTCC) for the proposed acquisition by San Miguel have already been obtained.

“MDTCC’s approval was made subject to operational conditions relating to dealers and employees, and Esso Malaysia obtaining necessary approvals from other relevant governmental agencies,” Esso said in a statement.

International oil giant ExxonMobil first announced its intention to sell its 65% stake in Esso Malaysia and 100% in two other unlisted subsidiaries – Exxon Mobil Malaysia Sdn Bhd and ExxonMobil Borneo Sdn Bhd – for a total price of US$610mil (RM1.94bil) to San Miguel in August.

Under the deal, San Miguel would take over ExxonMobil’s industrial and wholesale and aviation fuels businesses, the Port Dickson refinery, equity interest in 10 fuel distribution terminals and 560 branded retail fuel sites.

Esso’s shares fell three sen to RM3.47 yesterday.

San Miguel’s bid of RM3.50 per Esso share, comprised a 25% premium over the counter’s average six-month share price and before the share price run-up led by pure speculation. Before the run-up in prices, Esso was only traded at the RM2.80 range, and rumours started back in April that ExxonMobil was looking to privatise Esso and that ExxonMobil was selling its assets in Malaysia.