KUALA LUMPUR (March 20): Shares of EP MANUFACTURING BHD [] (EPMB) extended its losses on Tuesday as investors were concerned about the proposed acquisition of the 26km Maju Expressway (MEX) from Maju Holdings Sdn Bhd as pricey.
At 10.15am, EPMB was down 5.5 sen to 91 sen with 1.24 million shares done. On Monday, it slid 13.8% or 15.5 sen to 96.5 sen.
The FBM KLCI was up 3.81 points to 1,577.41. Turnover was 683.38 million shares valued at RM252.98 million. There were 213 gainers, 193 losers and 292 stocks unchanged.
OSK Research said on Monday the acquisition at RM1.7 billion would include assuming debts totaling RM550 million.
Under the deal, the auto parts maker will pay RM1.7 billion for the highway concessionaire, according to sources. The RM1.7 billion price tag includes debts. The MEX links the city centre in Jalan Tun Razak here to Putrajaya.
“Although traffic growth is expected to be resilient, from a valuation standpoint, the deal looks pricey and raises our concern that it may cause EPMB’s net gearing to to 457% this year. Besides, the high interest cost will erode earnings in the immediate term,” it said.
At 10.15am, EPMB was down 5.5 sen to 91 sen with 1.24 million shares done. On Monday, it slid 13.8% or 15.5 sen to 96.5 sen.
The FBM KLCI was up 3.81 points to 1,577.41. Turnover was 683.38 million shares valued at RM252.98 million. There were 213 gainers, 193 losers and 292 stocks unchanged.
OSK Research said on Monday the acquisition at RM1.7 billion would include assuming debts totaling RM550 million.
Under the deal, the auto parts maker will pay RM1.7 billion for the highway concessionaire, according to sources. The RM1.7 billion price tag includes debts. The MEX links the city centre in Jalan Tun Razak here to Putrajaya.
“Although traffic growth is expected to be resilient, from a valuation standpoint, the deal looks pricey and raises our concern that it may cause EPMB’s net gearing to to 457% this year. Besides, the high interest cost will erode earnings in the immediate term,” it said.
