KUALA LUMPUR: The International Trade and Industries Ministry (Miti) and the Domestic Trade, Cooperatives and Consumerism Ministry (MTDCC) have given their letters of approval for San Miguel Corp’s proposed acquisition of a 65% stake in Main Market-listed Esso Malaysia Bhd.
According to the announcement, the MTDCC’s approval was given subject to operational conditions relating to dealers and employees, and Esso Malaysia obtaining relevant approvals from other relevant government agencies.
“Esso Malaysia will make further announcements at the appropriate time when there are any material developments related to the matter,” stated Esso Malaysia in the announcement.
On Aug 17, the Philippines-based San Miguel announced that it was buying the 65% stake in Esso Malaysia from ExxonMobil International Holdings Inc for RM614.25 million cash. This worked out to RM3.50 per share.
Yesterday, Esso Malaysia’s share price closed at RM3.47. Once the acquisition is completed, San Miguel will have to undertake an offer for the remaining Esso Malaysia shares it does not own.
It is worth noting that arm forces fund Lembaga Tabung Angkatan Tentera (LTAT) had earlier bid for the stake in Esso Malaysia but it could not match San Miguel’s offer. There was subsequently a call for the government to intervene for the stake to be sold to Malaysian companies but this was rejected by the government.
In addition to the stake in Esso Malaysia, San Miguel had also acquired from the ExxonMobil group other Malaysia units such as ExxonMobil Borneo Sdn Bhd and ExxonMobil Malaysia Sdn Bhd for a collective price tag of US$404 million (RM1.28 billion).
According to reports, San Miguel saw potentials in upgrading Esso Malaysia’s existing refineries, which would help it move up the value chain. It is also lured by the steady earnings stream coming in from Esso Malaysia’s 560 retail stations.
San Miguel, which is better known for its food and brewery activities, has been diversifying into other sectors over the past few years, including power generation and distribution and airports among others.
This article appeared in The Edge Financial Daily, November 22, 2011.
According to the announcement, the MTDCC’s approval was given subject to operational conditions relating to dealers and employees, and Esso Malaysia obtaining relevant approvals from other relevant government agencies.
“Esso Malaysia will make further announcements at the appropriate time when there are any material developments related to the matter,” stated Esso Malaysia in the announcement.
On Aug 17, the Philippines-based San Miguel announced that it was buying the 65% stake in Esso Malaysia from ExxonMobil International Holdings Inc for RM614.25 million cash. This worked out to RM3.50 per share.
Yesterday, Esso Malaysia’s share price closed at RM3.47. Once the acquisition is completed, San Miguel will have to undertake an offer for the remaining Esso Malaysia shares it does not own.
It is worth noting that arm forces fund Lembaga Tabung Angkatan Tentera (LTAT) had earlier bid for the stake in Esso Malaysia but it could not match San Miguel’s offer. There was subsequently a call for the government to intervene for the stake to be sold to Malaysian companies but this was rejected by the government.
In addition to the stake in Esso Malaysia, San Miguel had also acquired from the ExxonMobil group other Malaysia units such as ExxonMobil Borneo Sdn Bhd and ExxonMobil Malaysia Sdn Bhd for a collective price tag of US$404 million (RM1.28 billion).
According to reports, San Miguel saw potentials in upgrading Esso Malaysia’s existing refineries, which would help it move up the value chain. It is also lured by the steady earnings stream coming in from Esso Malaysia’s 560 retail stations.
San Miguel, which is better known for its food and brewery activities, has been diversifying into other sectors over the past few years, including power generation and distribution and airports among others.
This article appeared in The Edge Financial Daily, November 22, 2011.
