Tradewinds Boss raised the previous Pathetic Offer

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Feb 14 2008
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Four months ago businessman Syed Mokhtar tried to purchase stocks he didn’t own from shareholders cheaply. The offer prices were ridiculously cheap as if he was trying to insult the shareholders’ intelligence, although his primary intention was to ensure he get hold of the RM597 million to repay debts totaling RM355 million. For example his offer price for Tradewinds Plantation Berhad (KLSE: TWSPLNT, stock-code 6327) was merely RM2.73 a share when the pre-suspension price was RM2.74. Nobody in their right mind would have accepted the offer for obvious reason.

Tradewinds Plantation has a fair-value of RM4.70, RM4.50, RM2.95 and RM2.40 a share estimated by Merrill Lynch, Aseambankers, AmResearch and Kenanga Investment Bank respectively. Although Tradewinds Plantation was trading at a high multiple, the company could easily be takeover target considering the bullishness of crude palm oil prices during that period. Shareholders of course threw the offer letter into the dustbin the moment it reached their mailbox – you didn’t accept the offer, did you?

Today Perspective Lane (M) Sdn Bhd, controlled by Syed Mokhtar raised the offer for all the shares it doesn’t already own in Tradewinds Plantations to RM3.79 a share (from RM2.73 previously) – RM1.06 a share more. The counter which stock price was RM3.66 pre-suspension today is expected to jump when it’s stock resume trading tomorrow. This is a classic example of how shareholders could get a better offer price if stay united in facing intimidation from major shareholder(s).

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