Yinson consortium considers raising Malaysia privatization offer

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Yinson considers privatization offer

Highlights

Consortium including the Lim family, the EPF and MISC Bhd considers raising its Yinson privatization offer to around RM2.50 per share, a 4% premium to the current share price.
The group could announce an increased bid as early as this week, but shareholder and regulatory approvals are still required before the transaction can be finalized.
Yinson shares have risen 5% since the initial offer of RM2.35 per share in August and now trade at RM2.27, with a market capitalization of around US$1.6 billion. The Lim family holds 27.7%, and the EPF holds 17.1%.

This article was translated from the original. Read the original version by our correspondent here.

Higher bid proposed for this week

As reported by The Edge Malaysia, citing Bloomberg, the consortium, which includes the Lim family, the Employees Provident Fund and MISC Bhd, is considering an offer of around RM2.50 per share, up from RM2.35 previously, according to people familiar with the matter. The price represents a premium of about 4% to Thursday's share price and values Yinson at around RM7.3 billion.

The group could announce the increased bid as early as this week, the people said. Any transaction remains subject to shareholder and regulatory approval, while ongoing discussions may also fail to result in a higher offer.

Representatives of the Lim family and Yinson declined to comment, while the EPF and MISC did not respond to requests for comment.

Ownership background and market implications

In August, the consortium announced that it was considering an indicative offer of RM2.35 per share for a proposed buyout of Yinson valued at an estimated US$1.7 billion, equivalent to RM6.88 billion. Yinson operates floating production, storage and offloading vessels, and also owns renewable energy and electric vehicle assets.

Yinson shares have risen around 5% since then and traded at RM2.27 on Thursday, giving it a market capitalization of around US$1.6 billion. According to Yinson's website, the Lim family founded the company as a logistics business in the 1980s and held a 27.7% stake as of the end of July, while the EPF held 17.1%, indicating that related parties already have significant influence over any privatization move.

The mandatory general offer (MGO) for United Malacca at RM6.10 per share was the focus of our earlier report, when the bidding group began the takeover process after its stake crossed the threshold that triggered an MGO. We also discussed the offer's valuation relative to the company's underlying value, as well as the cash compensation scheme for shareholders who sell below RM6.10 within the specified period, while the takeover process is still underway.

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