KUALA LUMPUR: The delay sought by ENG TEKNOLOGI HOLDINGS BHD []'s major shareholder TYK Capital Bhd in the takeover exercise is raising concerns among analysts.
On Thursday, Oct 13, Eng Tek said TYK Capital had sought to extend both the due diligence period and funding confirmation period by 45 days.
The extension was agreed by Eng Tek on Oct 7 as the 'extension of time is to provide TYK Capital's financiers more time to complete the due diligence,' it said.
Eng Tek also said''the floods in Ayutthaya, Thailand has resulted in the temporary shut down of the group's Thai operations on Oct 8.
'As the Thai operations contribute approximately 40% to the Eng Tek group's revenue for the financial year ended Dec 31, 2010, the company and TYK Capital are working together to assess the flood situation, the impact on the financial position and prospects of the Eng Tek Group (once there is clarity on the flood situation) and how this may affect the terms and conditions and/or the viability of the proposals,' it said.
An analyst said Eng Tek's decision was made separately and independently of the floods in Thailand (which have impacted 40% of their revenue).
However, he expressed some concern that there might have been some linkage.
Another question raised was why had Eng Tek's shares trading at such a large discount to the privatisation offer price of RM2.50. The analyst said the concern was the market's concern whether the privatisation could go through.
''
On Thursday, Oct 13, Eng Tek said TYK Capital had sought to extend both the due diligence period and funding confirmation period by 45 days.
The extension was agreed by Eng Tek on Oct 7 as the 'extension of time is to provide TYK Capital's financiers more time to complete the due diligence,' it said.
Eng Tek also said''the floods in Ayutthaya, Thailand has resulted in the temporary shut down of the group's Thai operations on Oct 8.
'As the Thai operations contribute approximately 40% to the Eng Tek group's revenue for the financial year ended Dec 31, 2010, the company and TYK Capital are working together to assess the flood situation, the impact on the financial position and prospects of the Eng Tek Group (once there is clarity on the flood situation) and how this may affect the terms and conditions and/or the viability of the proposals,' it said.
An analyst said Eng Tek's decision was made separately and independently of the floods in Thailand (which have impacted 40% of their revenue).
However, he expressed some concern that there might have been some linkage.
Another question raised was why had Eng Tek's shares trading at such a large discount to the privatisation offer price of RM2.50. The analyst said the concern was the market's concern whether the privatisation could go through.
''
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