THE non-interested directors of FGV Holdings Bhd (FGV) have recommended the company’s shareholders reject the mandatory take-over offer by the Federal Land Development Authority (Felda) due to the lower fair value offered at RM1.30 per share.

In a statement, FGV said the recommendation was made after careful examination of the terms and conditions of the offer and the rationale for the offer and the future plans for FGV Group and its employees as disclosed in the offer document.

“Taking into consideration the opinions, views and recommendations by RHB Investment Bank Bhd (RHB IB), being the independent adviser for the offer, the offer price is ‘not fair’ as it is below the fair value by RHB IB, which ranges (between) RM1.42 to RM1.60 per FGV share, or a discount of 8.5% to 18.8%,” said FGV.

Meanwhile, RHB IB is of the view that the offer is ‘not fair but reasonable’ based on its evaluation of the offer and recommended the minority shareholders accept the offer.

This was due to FGV not receiving any alternative proposals for the offer shares, including any offer to acquire the assets and liabilities of FGV Group.

The non-interested directors of FGV, namely Yusli Mohamed Yusoff, Mohd Anwar Yahya, Hoi Lai Ping, Mohamed Nazeeb P. Alithambi and Nesadurai Kalanithi, have not concurred with the recommendation made by RHB IB for shareholders to accept the offer.

The directors said the management of FGV had since 2019 implemented a transformation programme, namely Business Plan 2019-2021, focusing on operational improvements and strengthening governance and accountability in line with FGV’s status as a public listed company (PLC).

“Keeping FGV as a PLC will ensure the transparency and timely disclosures of FGV, being one of the largest plantation companies in the world in terms of crude palm oil production with over three million tonnes produced in 2019.”

In recommending that shareholders accept the offer, RHB IB also said that Felda and persons acting in concert with it have a collective shareholding of 54.09% as at January 15, 2021, which provides them control and are able to determine the outcome of resolutions sought at FGV general meetings.

The number of FGV shares acquired by Felda so far this week amounted to 75.97 million shares.

On January 12, Felda issued an offer document in relation to its unconditional mandatory take-over offer for all remaining shares in FGV that it does not own, except treasury shares.

Felda also said it does not intend to maintain the listing status of FGV on the Main Market of Bursa Malaysia.

Shareholders will have until 5pm on Tuesday, February 2, 2021 to accept the offer, unless revised or extended.

Any revision or extension will be announced by Maybank Investment Bank Bhd (Maybank IB), the principal adviser on behalf of Felda, at least two days before the closing date, and notice of revisions or extensions will be posted to the shareholders accordingly.

At 3.55pm today, FGV shares were flat at RM1.30 with 3.53 million shares transacted, while its market capitalisation stood at RM4.74 billion. – Bernama, January 22, 2021.