Following a swirl of speculation in South East Asia, reclusive billionaire Ananda Krishnan has confirmed to the Bursa Malaysia that he intended to acquire Malaysian satellite operator Measat and then take it private.
On July 28, Krishnan requested the…
Following a swirl of speculation in South East Asia, reclusive billionaire Ananda Krishnan has confirmed to the Bursa Malaysia that he intended to acquire Malaysian satellite operator Measat and then take it private.
On July 28, Krishnan requested the Bursa halted share trading on two of his portfolio companies: Measat and Tajong, a gaming and power group. He then made a formal take-over offer for Measat of MR4.2 (US$1.32) per share for the 40.4% for the equity he does not already own. This would offer a premium of 10.5% over the share price that Measat was trading at when the Bursa suspended its shares.
The total transaction would cost Krishnan MR662.6m (US$207m).
The satellite operator’s shares rose to a six-year high to hit MR4.07 (US$1.28) when trading resumed early Thursday July 29 after it was halted Wednesday ahead of the announcement.
CIMB and Maybank are advising Krishnan’s holding company MGN and AmInvestment Bank is advising Measat.
Reports in Malaysia claim that the logic behind Krishnan’s plan is his belief that Measat’s minority shareholders, including Telekom Malaysia which holds more than 15% of the company, did not share his appetite for the increased cap ex investment required to make Measat a global competitor. Malaysian newspaper The Star alleged that Krishnan was looking to spend around US$1bn over the next two or three years to enable the satellite operator to significantly gain scale.
Krishnan set a similar precedent in June when he delisted Malaysian pay-TV group Astro All Asian Networks from the Bursa following his buyout of the firm for US$758m. Once delisted AAAN underwent a major overhaul, which is still going on in order to “re-energise the company’s growth, both locally and internationally,” a spokesman for AAAN confirmed at the time.
It was widely speculated that following the privatisation Krishnan would seek to merge AAAN with another one of his holdings, Maxis Communications, which was delisted in 2007. However, this appeared to be conjecture. The Maxis rumour saw Measat’s shares suspended in June last year, as its share price jumped 53% in one day as traders tried to cash in on what they thought they knew.
Representatives of CIMB and Measat had not responded to requests for comment at the time of going to press.
