Barefoot Investor: E&O active on stake sale to Sime Darby

Eastern & Oriental Bhd (E&O) shares were actively traded on Monday, after SIME Bhd's announcement it was acquiring a 30% strategic stake in E&O at RM2.30 per share or RM766 million.

According to SIME Darby, the acquisition was to extend its presence in the property development and hospitality sectors, beyond the Greater KL region, specifically in Penang and Johor.

It is believed that Sime Darby 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.

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

Sime Darby said at RM2.30 per E&O share, the deal was valued at about a 20% discount to E&O’s estimated realisable net asset value (RNAV) of RM3.2 billion.(


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