Hot Stock Pos Malaysia shares up 3.41% on acceptance of DRB-Hicom deal

by **Cals** Thu 17 Dec 2015, 21:03

Hot Stock

[size=28]Pos Malaysia shares up 3.41% on acceptance of DRB-Hicom deal

By Meena Lakshana / theedgemarkets.com | December 17, 2015 : 11:05 AM MYT
KUALA LUMPUR (Dec 17): Pos Malaysia Bhd ([You must be registered and logged in to see this image.] Valuation: 1.40, Fundamental: 2.20)'s shares rose as high as 3.41% in early morning trades today, following the postal service provider's acceptance of a deal to purchase KL Airport Services Sdn Bhd (KLAS) and a parcel of industrial land in Shah Alam from DRB-Hicom Bhd ( Valuation: 2.00, Fundamental: 0.00) for RM835.16 million.
At 10.30am, Pos Malaysia shares rose as much as 9 sen to RM2.73 before settling at RM2.71. A total of 663,100 shares were traded.
After charting a solid increase in the beginning of the year, the stock has been on a steady decline since May 18 this year.
Year to date, the stock has declined 43.1%, widely underperforming the FBM KLCI, which has declined 7.22%.
Yesterday, Pos Malaysia announced to Bursa Malaysia that it has accepted DRB-Hicom's conditional offer for the sale of the latter's wholly-owned KLAS and a parcel of industrial land in Shah Alam for RM835.16 million.
Pos Malaysia had said the sale and purchase agreements (SPAs) to effect the transactions would be executed within three months from the acceptance of the offer.
However, the acceptance is subject to the results or findings of the due diligence exercise to be conducted by Pos Malaysia and execution of the SPAs within the exclusivity period.
The proposed acquisitions of KLAS and the Section 28 land in Shah Alam would also be conditional upon the approval of the company's shareholders at an extraordinary general meeting to be convened.
On Dec 10, DRB-Hicom had announced its offer to sell KLAS and part of a freehold industrial land in Shah Alam to Pos Malaysia, to consolidate its logistics business under Pos Malaysia.
The disposal, subject to the complete capitalisation of RM552.9 million owed by KLAS to DRB-Hicom and the transfer of 100 acres of land in Kedah from Konsortium Logistik Bhd (owned by KLAS) to DRB-Hicom, would be satisfied via the issuance of 250.8 million new ordinary shares in Pos Malaysia at an issue price of RM3.33 a share.
(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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