Killinghall (Malaysia) Bhd has given an ultimatum to Southern Bank Bhd (SBB) to call for an EGM for its shareholders to vote on Bumiputra-Commerce Holdings Bhd’s (BCHB) takeover offer, without any further delay.
If it fails to do so by Feb 21 and in the event BCHB’s takeover notice is valid, Killinghall said it would exercise its rights as a major shareholder to requisition an EGM in SBB to allow shareholders to decide on BCHB’s proposals.
“We hope the board of SBB will consider our request favourably. In the event no EGM of SBB is called to deliberate on the matters, the board will seek to exercise the company’s rights as a major shareholder of SBB,” Killinghall told Bursa Malaysia on Feb 16.
Killinghall, which holds a 17% stake in SBB, said it was calling for its own EGM for its shareholders to decide whether to accept BCHB’s offer, assuming the notice is valid.
At its proposed EGM, Killinghall said its shareholders could also decide on any other proposal recommended by SBB’s board if such a proposal was outlined prior to the notice of EGM.
Killinghall said its board had appointed ECM Libra Capital Sdn Bhd as its financial adviser on the matter.
Meanwhile, SBB chief executive director Tan Sri Tan Teong Hean said he wanted to initiate talks with a potential merger partner as soon as it received the green light from Bank Negara.
Tan, however, neither confirmed nor denied that SBB was pursuing Malayan Banking Bhd (Maybank) to become its potential partner. He was speaking to reporters in Kuala Lumpur on Feb 16 after officially launching SBB Mutual Bhd’s new global funds.
“I’m not saying that we are going to merge with Maybank. What I said was we have set the criteria and set the matrix by which we will evaluate potential merger partners and I did not say that we have been negotiating with Maybank at this point of time,” he said.
“So if you are asking me whether we should merge with one bank or another, I am saying that the board has put in the process and also put in place a set of criteria and we have identified an institution but we are not yet in negotiation.”
Among others, SBB is seeking the right valuation for the merger and synergy with its potential partners. “We will make merger partnership based on that set of criteria so as to maximise value for shareholders,” Tan said.
On BCHB’s takeover offer, he said the matter had been clarified in SBB’s press statements and reiterated that any offer had to comply with the Malaysian Code on Take-Over and Mergers.
Having rejected BCHB’s offer on Feb 14, SBB is seeking a ruling from the Securities Commission (SC) on the validity of BCHB’s “unsolicited” notice of takeover offer.
In a statement on Feb 16, BCHB said it welcomed SBB’s decision to seek a ruling from the SC and believed that such matters were best addressed to the regulators.
“We are fully confident that a valid notice of takeover offer has been made and that the board of SBB must act on this in the best interest of its shareholders,” it said.
BCHB reiterated that a material and credible offer was made to SBB and its shareholders and “the board of SBB should not unilaterally decide to deprive shareholders of the opportunity to consider and benefit from the offer”.
Meanwhile, in a statement to Bursa Malaysia, SBB claimed that BCHB’s notice did not comply with section 12(4)(a) of the Code as it failed to provide any information on the identity of the persons who were acting-in-concert with BCHB.
It added that it was a material omission and an infringement of the Securities Commission Act that the acquisition of voting shares or control of companies took place in an efficient, competitive and informed market.
SBB said it was the law that the shareholders and directors of the offeree and the market were aware of the identity of the acquirer and offeror.