KUALA LUMPUR: Private equity fund Navis Capital Partners Ltd has engaged in “informal discussions” to buy a controlling stake in China-based Xidelang Holdings Ltd.
If it happens, the move would result in a mandatory general offer (MGO) for the rest of the company.
In a statement to Bursa Malaysia yesterday, Xidelang said Navis Capital had indicated its intention to acquire “the entire shareholding” held by Xidelang’s major shareholder HongPeng International Holdings Ltd.
HongPeng, the private vehicle of Xidelang co-founder, managing director and CEO Ding Pengpeng, holds 54.55% of Xidelang, which makes sports shoes, apparel and accessories.
“There was no discussion on Navis Capital’s offer price,” Xidelang said in a separate statement to further clarify a news report that appeared in the Chinese daily Nanyang Siang Pau.
The paper, quoting unnamed sources, said Navis Capital valued Xidelang at 1.2 times book based on the latter’s FY10 net asset value of 59 sen per share. At 70.8 sen apiece, HongPeng’s 54.55% stake could be worth RM169.92 million, back-of-the-envelope calculations showed.
Xidelang’s net asset value (NAV) stood at 72.72 sen per share, according to unaudited results for the third quarter ended Sept 30, 2011.
Xidelang shares were trading between 35.5 sen and 38 sen in the morning session yesterday before trading was suspended for an hour between 2.30pm and 3.30pm for the announcement.
Xidelang shares jumped to as high as 44.5 sen when trading resumed, before closing at 41 sen, up 4.5 sen or 12.33% for the day. It was yesterday’s third most active stock with a volume of 54.89 million shares.
According to Xidelang’s 2010 annual report, its three largest shareholders are HongPeng, Ding Chaohui (3.4%) and Zhuang Guohua (3.18%).
Notably, Xidelang shares had largely traded below NAV and barely touched the 50 sen per share mark over the past year, stock market data showed. The shares had in the past few days chalked up their steepest gains ever, adding eight sen or 27.11% to 37.5 sen on Tuesday from 29.5 sen on Dec 30 last year.
If Navis Capital makes an official offer for HongPeng’s 54.55% block in Xidelang, the private equity firm will have to offer the same price to buy out all other shareholders.
That would resemble Navis Capital’s acquisition and subsequent privatisation of formerly Singapore-listed industrial footwear maker King’s Safetywear Ltd in December 2008 for US$74 million (RM232.4 million). Last November, Navis Capital made headlines after it flipped its stake in King’s Safetywear to US manufacturing conglomerate Honeywell International for US$338 million.
If it happens, the move would result in a mandatory general offer (MGO) for the rest of the company.
In a statement to Bursa Malaysia yesterday, Xidelang said Navis Capital had indicated its intention to acquire “the entire shareholding” held by Xidelang’s major shareholder HongPeng International Holdings Ltd.
HongPeng, the private vehicle of Xidelang co-founder, managing director and CEO Ding Pengpeng, holds 54.55% of Xidelang, which makes sports shoes, apparel and accessories.
“There was no discussion on Navis Capital’s offer price,” Xidelang said in a separate statement to further clarify a news report that appeared in the Chinese daily Nanyang Siang Pau.
The paper, quoting unnamed sources, said Navis Capital valued Xidelang at 1.2 times book based on the latter’s FY10 net asset value of 59 sen per share. At 70.8 sen apiece, HongPeng’s 54.55% stake could be worth RM169.92 million, back-of-the-envelope calculations showed.
Xidelang’s net asset value (NAV) stood at 72.72 sen per share, according to unaudited results for the third quarter ended Sept 30, 2011.
Xidelang shares were trading between 35.5 sen and 38 sen in the morning session yesterday before trading was suspended for an hour between 2.30pm and 3.30pm for the announcement.
Xidelang shares jumped to as high as 44.5 sen when trading resumed, before closing at 41 sen, up 4.5 sen or 12.33% for the day. It was yesterday’s third most active stock with a volume of 54.89 million shares.
According to Xidelang’s 2010 annual report, its three largest shareholders are HongPeng, Ding Chaohui (3.4%) and Zhuang Guohua (3.18%).
Notably, Xidelang shares had largely traded below NAV and barely touched the 50 sen per share mark over the past year, stock market data showed. The shares had in the past few days chalked up their steepest gains ever, adding eight sen or 27.11% to 37.5 sen on Tuesday from 29.5 sen on Dec 30 last year.
If Navis Capital makes an official offer for HongPeng’s 54.55% block in Xidelang, the private equity firm will have to offer the same price to buy out all other shareholders.
That would resemble Navis Capital’s acquisition and subsequent privatisation of formerly Singapore-listed industrial footwear maker King’s Safetywear Ltd in December 2008 for US$74 million (RM232.4 million). Last November, Navis Capital made headlines after it flipped its stake in King’s Safetywear to US manufacturing conglomerate Honeywell International for US$338 million.
