Barefoot Investor: Malaysia Market: Hirotako shares up on MBM Resources takeover

KUALA LUMPUR: Hirotaka Holdings Bhds shares rose on Friday, Oct 28 after MBM RESOURCES BHD [] (MBM) launched a takeover to expand its automotive manufacturing division, at a cost of RM412.5 million.

At 9.14am, Hirotako share price was up 6.5 sen to 94.5 sen with 7.27 million shares done. However, the warrants fell six sen to 17.5 sen with 26.49 million units transacted.

The FBM KLCI rallies 12.54 points to 1,483.47. Turnover was 298.17 million shares valued at RM186.47 million. There were 417 gainers to 31 losers.

MBM offered 97 per share which was nine sen above the pre-suspension price of 88 sen and only 5.0 sen per warrant.

OSK Research said at 97 sen, this was 14% above Hirotako’s five-day market average closing prices of 85 sen a share and 5% above the warrant’s exercise price of 92 sen a share.

OSK Research said the acquisition price tag is not cheap, valuing Hirotako at 11 times FY11 price-to-earnings, which is at the high end of its historical trading band (slightly above +2 SD for PE and P/BV).(


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