Business

Saturday August 29, 2009

Tradewinds to buy 53.7% of Bernas for RM526mil


PETALING JAYA: Tradewinds (M) Bhd has proposed to acquire a 53.76% stake in rice importer Padiberas Nasional Bhd (Bernas) for RM526mil cash.

In a filing with Bursa Malaysia yesterday, the sugar manufacturer and palm plantation company said it would acquire 31.52% from Hong Kong-based Wang Tak Co Ltd for RM308.4mil and a further 22.24% from Gandingan Bersepadu Sdn Bhd for RM217.6mil.

Tradewinds said the proposals, which were expected to be completed by the fourth quarter of 2009, would allow the company to tap into Bernas’ existing marketing and distribution networks all over Malaysia, which were significantly larger than its own.

It added that the proposed acquisitions would enable Tradewinds to share similar distribution channels with Bernas, such as warehousing and transportation and ensuring greater economies of scale and operational efficiency.

“Our national interest is the overriding factor in this proposed exercise but we also anticipate tremendous business synergies by eliminating duplication of resources, enhancing cost-savings initiatives and allowing both companies to leverage on existing business infrastructure.

“We foresee significant improvements in productivity and efficiency across the enlarged group which would benefit the shareholders,” said Tradewinds chairman Datuk Wira Syed Abdul Jabbar Syed Hassan (pic) in a statement.

Tradewinds said with the resulting 54% stake in Bernas, it would be obliged under stock exchange rules to make a mandatory general offer (MGO) for the outstanding stock.

However, it plans to seek an exemption from the Securities Commission from having to undertake the MGO. Following the takeover, the companies were expected to have a market capitalisation of close to RM3bil, it said, adding that the acquisitions would be made via bank borrowings.

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