PNB turns down Sunway’s RM11b takeover offer for IJM after valuation review

KUALA LUMPUR, March 16 — Permodalan Nasional Bhd (PNB) has decided not to accept the voluntary takeover offer (VTO) by Sunway Corporation Bhd for its 13.5 per cent stake in IJM Corporation Bhd.

In a statement today, PNB said the decision was made by its Board Investment Committee after a “careful, rigorous and independent evaluation” conducted in line with the fund manager’s investment process and governance framework.

“The assessment was made based on commercial considerations and guided by our fiduciary responsibility to always act in the best interest of PNB’s unitholders, in alignment with our purpose and mandate,” it said.

PNB said its evaluation considered several factors, including the estimated intrinsic value of IJM shares relative to the offer price, the limited cash component of the proposal, and the potential upside of shares to be issued under the deal.

It added that IJM’s dividend outlook and long-term value creation prospects were also taken into account.

PNB stressed that the decision was based solely on its own strategic considerations as a long-term institutional investor and was not intended to influence other IJM shareholders.

“All IJM shareholders should make their own independent assessment,” the company said.

PNB also noted that IJM’s market valuation had not reflected the company’s underlying value for a considerable period.

“Accordingly, irrespective of the outcome of the VTO, we expect the board and management of IJM to prioritise efforts to crystallise this value for the benefit of all shareholders,” it said.

On January 12, Sunway proposed a conditional voluntary takeover offer to acquire all 3.51 billion IJM shares at RM3.15 each, in a deal valued at about RM11 billion to be settled through a combination of cash and newly issued Sunway shares.

Last Friday, IJM’s independent adviser, M&A Securities Sdn Bhd, said the offer was neither fair nor reasonable and recommended shareholders reject it.

In a filing with Bursa Malaysia, IJM said the adviser estimated the company’s share value at between RM5.84 and RM6.48, meaning the RM3.15 offer price represented a discount of between RM2.69 and RM3.33, or about 46.1 per cent to 51.4 per cent.