KUALA LUMPUR: Minister of Plantation and Commodities Datuk Seri Johari Abdul Ghani said the ongoing corporate exercise (mandatory general offer) at KUB Malaysia Bhd, which he stressed was initiated before his ministerial appointment, must proceed to ensure fairness to shareholders.
“That exercise (MGO) was done before I was appointed as Minister. So this is just to complete it, we cannot cancel and withdraw. That’s it,” he told reporters at the Malaysian Palm Oil Board Palm Oil Economic Review and Outlook Seminar 2024 yesterday.
Addressing concerns about the ongoing MGO, Johari clarified that the MGO is not driven by valuation concerns.
“Actually, the corporate exercise that you see today was the exercise that I’ve already done it and announced it prior to my appointment as minister. So it involved a general offer. So you can’t abort, you have to be fair to the shareholders. They know that I’m going to embark on the general offer at that time, before my appointment. So I cannot abort it. So therefore we have to proceed. So that’s it. Nothing more than that. And I never do the GO, the company does the GO,” he explained.
The MGO is a regulatory requirement in the financial markets to ensure fair treatment of all shareholders. When an entity crosses a specified ownership threshold, it must make a mandatory offer to acquire the remaining shares from other shareholders at a predetermined price. This is intended to provide an equal opportunity for all shareholders to exit their investment at a fair price.
Johari is the shareholder of JAG Capital Holdings Bhd with a 98.75% stake. JAG on Jan 8 launched a voluntary takeover of KUB Malaysia Bhd, and on Tuesday triggered a MGO of the company. This was after JAG bought 1.79 million KUB shares, which raised its shareholding above the 33% threshold which triggered the MGO. However, JAG has conditions: If it gets 90% of KUB shares, it won’t keep KUB listed; it will keep the listing if it is between 75% and 90%.
