Lim's rising stake in ECM stirs market talk (2143)

by **hlk** Fri 21 Sep 2012, 08:25

KUALA LUMPUR: Lim Kian Onn, the co-founder of
ECM Libra Financial Group Bhd, is keeping the market guessing on his
recent purchases of ECM shares.

Since July, Lim has bought more than 30 million ECM shares from the
open market - increasing his stake from 9.7 per cent to almost 14 per
cent in the company. Prior to these acquisitions, Lim did not buy ECM
shares from the open market.

"There
could be various reasons why he is accumulating the shares. Maybe he
wants to beef up his position ahead of a possible merger and
acquisition exercise," said Edmund Tham, Mercury Securities head of
research.

In June, K&N Kenanga Holdings Bhd agreed to buy
ECM Libra Investment Bank Bhd for RM875.1 million, of which RM659.61
million would be settled in cash while the rest in shares and loan
stocks.

The deal, which is expected to be completed in November
this year, will catapult Kenanga into the country's largest independent
investment bank with a market share of 12.4 per cent and 8.9 per cent
respectively in trading volume and value.

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It will also transform Kenanga into one of the top three brokerage houses with the largest remisier network post merger.

"Lim could also be accumulating the shares as he could have identified a new core business for the company," said Tham.

That
train of thought holds some water as OSK Holdings Bhd founder Tan Sri
Ong Leong Huat had snapped up OSK shares after the announcement of a
merger between OSK and RHB Capital Bhd.

The announcement of the RHB-OSK merger was made in May, and by as early as June, Ong had started to buy OSK shares.

From
June to now, Ong had exercised his share options. He now directly owns
294.9 million shares, compared to 285.9 million shares earlier this
year.

At press time, Lim has yet to respond to Business Times queries.

Lim,
who is known in the market for his expertise in restructuring exercise,
was one of the key people behind the restructuring of Technology
Resources Industries Bhd (TRI) to raise some RM3.8 billion about a
decade ago.

ECM shares closed 1 sen lower at 86 sen yesterday. Year-to-date, its shares have gained by more than 10 per cent.