Monday, September 5, 2011

E&O continues ascend in early trade

KUALA LUMPUR: Eastern & Oriental Bhd (E&O) shares continued to extend their gains and were actively traded on Monday, Sept 5 on investors' positive view of SIME DARBY BHD []'s acquisition a 30% strategic stake in the company at RM2.30 per share or RM766 million.

At 9.25am, E&O was up two sen to RM1.62 with 5.89 million shares.

Sime Darby had said on Aug 29 that the acquisition was to extend its presence in the property development and hospitality sectors, beyond the Greater KL region, specifically in Penang and Johor.

Sime Darby said 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.

Both companies also entered into a three-year collaboration agreement to formalise a framework for their property development businesses.

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