Prudential fund buys into CIMA

Prudential fund buys into CIMA
Published: 30 September 2008

Prudential Fund Management Bhd (PFMB) bought a substantial stake in Cement Industries of Malaysia Bhd (CIMA), whose controlling shareholder UEM Group Bhd is making a conditional takeover offer to buy out all the shares it doesn’t own in the cement maker.

According to the filing to Bursa Malaysia, the institutional fund acquired 12.2m shares or 8.7 per cent equity stake in CIMA last Sept 22 from the open market but without stating the price it paid.

UEMG was offering RM6.26 a share in CIMA as a result of the undertaking to subscribe its entitlements under the proposed restricted offer for sale (ROS) made by its 51.9 per cent owned UEM World Bhd. CIMA closed at RM6.10 yesterday.

In February, UEM World — which owns a 50.5 per cent stake in CIMA — made an ROS of all stocks it owns in the publicly listed companies to its shareholders, including UEMG. Being a major shareholder, UEMG will take over UEM World’s equity in CIMA at the offer price of RM6.26 a share.

The aim of this exercise was to flatten the UEM Group’s structure and to have UEM Land Bhd, which will take over the listing status of UEM World, focus on property development.

UEMG’s takeover offer closed yesterday. In the announcement to Bursa Malaysia, CIMA said it would be taken private should UEMG and parties acting in concert obtain more than 90 per cent shareholding. The company will remain listed should UEMG’s shareholding be below 90 per cent.