AP Land adjourns EGM to Nov 15

KUALA LUMPUR: Asia Pacific Land Bhd (AP Land) has postponed the adjourned EGM to next Tuesday to seek shareholder approval to sell the company’s assets and liabilities to its major shareholder Low Yat Holdings Sdn Bhd.

The Oct 26 EGM was adjourned to yesterday due to a discrepancy in the company’s circular to shareholders relating to Low Yat’s proposed offer to buy the core business of AP Land for RM305.2 million or 45 sen per share.

Low Yat is the single largest shareholder of AP Land, holding 34% equity interest, and it is leading the management. There was an inconsistency between the AP Land audit committee’s findings and the directors’ recommendation.

The audit committee found the offer price to be a reasonable premium on the last transacted price on Jan 10 but agreed with independent adviser MIDF Amanah Investment Bank Bhd that from a financial point of view the deal is “not fair” due to the large discount on the net assets per share.

The directors’ recommendation, however, stated that the board (save for the interested directors) was of the opinion that the proposed disposal is “fair and reasonable and in the best interests of AP Land and its non-interested shareholders”.

After the meeting was adjourned, AP Land informed Bursa Malaysia later on the same day that the board had told shareholders at the meeting that it was of the opinion the offer by Low Yat was “not fair but reasonable” after taking into account the advice of Maybank Investment Bank Bhd.

The offer was at an 8% premium to AP Land’s closing price of 41.5 sen before the announcement on the proposed offer, and a 57% discount to the adjusted audited net assets per share of RM1.04 as at Dec 31, 2010.

The Minority Shareholder Watchdog Group told the media earlier that the discrepancy was material and could influence the voting on the proposed divestment.

Some minorities find the offer price of 45 sen per share way too low compared with AP Land’s net assets per share of RM1.04. Furthermore, some quarters pointed out the company’s landbank in Rawang could soon appreciate in value in view of the government’s mass rapid transit project, which is expected to improve the accessibility from the city centre to the suburban areas in the Klang Valley.

According to property valuer Khong & Jaafar, the undeveloped parcel of land in Rawang is worth RM349.2 million, compared with Low Yat’s offer price of RM305.2 million for all the assets in AP Land including plots of land in Penang, China and Japan as well as plantations.

On the flip side, if the minorities were to hold onto their shares in AP Land, there is no certainty the company’s share price would ever climb above RM1.

Some see this as a opportune time to exit, considering AP Land shares have mostly been trading below 40 sen since 2008.

In terms of financials, AP Land has been loss-making since FY09 ended Dec 31. Its net loss widened to RM5.79 million for the 6MFY11 ended June 30 from RM1.25 million in the previous corresponding period. Revenue shrunk substantially to RM44.4 million from RM62.2 million.

A point to ponder is that Low Yat, which has run the company for decades, is keen to buy out the asset rich but loss-making business now.


This article appeared in The Edge Financial Daily, November 9, 2011.

AP Land adjourned EGM on Nov 15

KUALA LUMPUR (Nov 8): AP Land Bhd’s adjourned EGM will be held on Nov 15 at the Tasik Puteri Golf & Country Club, Kundang, Selangor.

A company statement on Tuesday said the EGM was to consider and if thought fit, passing with or without modifications the relevant resolutions in the notice of adjourned EGM.

To recap, on Oct 26, the EGM ended mid-way following a discrepancy in the company’s circular to shareholders, pertaining to the proposed offer from 34%-owned shareholder Low Yat Holdings Sdn Bhd (LYH) to buy all the assets and liabilities of AP Land for RM305.2 million or 45 sen per share.

The discrepancy was due to an inconsistency between AP Land audit committee’s findings and the directors’ recommendation.

The audit committee found the offer price to be a reasonable premium on the last transacted price on Jan 10 but agreed with independent adviser MIDF Amanah Investment Bank Bhd that from a financial point of view the deal was “not fair” due to the large discount on the net assets per share.

The directors’ recommendation however stated, “our board (save for the interested directors) is of the opinion that the proposed disposal is fair and reasonable and in the best interests of AP Land and its non-interested shareholders.”

While the offer was at an 8% premium to AP Land’s closing price of 41.5 sen prior to the announcement, it is a 57% discount to the adjusted audited net assets per share of RM1.04 as of Dec 31, 2010.

AP Land EGM adjourned on discrepancy

RAWANG: Asia Pacific Land Bhd’s (AP Land) EGM ended mid-way on Tuesday following a discrepancy in the company’s circular to shareholders, pertaining to the proposed offer from 34%-owned shareholder Low Yat Holdings Sdn Bhd (LYH) to buy all the assets and liabilities of AP Land for RM305.2 million or 45 sen per share.

Shareholders will have to meet again on Nov 8 to decide if they want to accept the offer made on Jan 11 this year, once corrections have been made.

The discrepancy stems from an inconsistency between AP Land audit committee’s findings and the directors’ recommendation.

The audit committee found the offer price to be a reasonable premium on the last transacted price on Jan 10 but agreed with independent adviser MIDF Amanah Investment Bank Bhd that from a financial point of view the deal was “not fair” due to the large discount on the net assets per share.

The directors’ recommendation however stated, “our board (save for the interested directors) is of the opinion that the proposed disposal is fair and reasonable and in the best interests of AP Land and its non-interested shareholders.”

While the offer was at an 8% premium to AP Land’s closing price of 41.5 sen prior to the announcement, it is a 57% discount to the adjusted audited net assets per share of RM1.04 as of Dec 31, 2010.

Lya: At the end of the day, it is up to the minority shareholders to decide what they want.

The Minority Shareholder Watchdog Group’s (MSWG), which was present at the meeting, pointed out the contradiction.

MSWG general manager of corporate services Lya Rahman told The Edge Financial Daily, “MSWG sought clarification from the board the reason behind the difference in opinion between the board and the audit committee with regard to the fairness of the proposed disposal, as the majority of the disinterested board comprised the members of the audit committee.”

Lya said the disinterested directors informed the shareholders they had expressed their opinion that the proposed disposal was not fair and acknowledged the so-called discrepancy could be due to an error in the circular to shareholders under the directors’ recommendation.

“As the discrepancy was material which could influence the voting for the proposed disposal, MSWG proposed and insisted that the EGM be adjourned to be fair to the shareholders in particular those who have filed their proxies and made decisions based on the recommendations by the disinterested directors,” Lya explained.

Lya declined to comment on the fairness of the deal to minority shareholders but said, “At the end of the day, it is up to the minority shareholders to decide what they want.”

According to her, the offeror LYH needs only 50% plus one share from those who attend the EGM (apart from LYH) to push the deal through, and not 75% because the proposal was made before the change in the takeover rule.

“Attendance was low perhaps due to the EGM’s venue. Furthermore, they [the minority shareholders] were very passive,” she added.

Some 60 shareholders turned up for the EGM. Several shareholders said the venue Tasik Puteri Golf and Country Club was inconvenient due to its remote location.

Lya said questions during the EGM revealed that the directors of AP Land had not asked LYH to increase the offer. When contacted, AP Land declined to comment.

AP Land’s stock closed at 41.5 sen, slipping 1.5 sen on Tuesday.


This article appeared in The Edge Financial Daily, October 27, 2011.