Monday, August 29, 2011

#Flash* Sime Darby buys 30% of E&O for RM766m

KUALA LUMPUR: SIME DARBY BHD [] is acquiring a 30% strategic stake in Eastern & Oriental Bhd at RM2.30 per share or RM766 million as part of its direction to extend its presence in the property development and hospitality sectors, beyond the Greater KL region, specifically in Penang and Johor.

Sime Darby said on Monday, Aug 29, it was acquiring 273 million E&O shares and 60 million irredeemable convertible secured loan stocks (ICSLS) in E&O -- which on a fully diluted basis - was about a 30% equity interest in the niche property developer.

Sime Darby will acquire the stake from E&O managing director Datuk Tham Ka Hon and several other major shareholders of E&O.

The statement confirms a report by last Friday that Sime Darby may acquire a 30% stake in E&O.

At the same time, the two companies also signed a three-year collaboration agreement to formalise a broad collaborative framework for their property development businesses.

Sime Darby said that at a price of RM2.30 per E&O share the deal is valued at about a 20% discount to E&O's estimated realisable net asset value (RNAV) of RM3.2 billion.

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