Consortium Stands Firm On Rm11 Per Share Offer For Mahb

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Yesterday, five MAHB independent directors said Gateway Development Alliance’s offer was unfair and unreasonable and recommended that shareholders reject the offer. (Bernama pic)
KUALA LUMPUR: Gateway Development Alliance Sdn Bhd (GDA), the consortium proposing to privatise Malaysia Airports Holdings Bhd (MAHB), remains steadfast on its RM11 per share offer price, despite recommendations from independent directors for shareholders to reject it.
GDA comprises EPF, Khazanah Nasional Bhd-backed UEM Group Bhd, Abu Dhabi Investment Authority and BlackRock-owned Global Infrastructure Partners.
In a statement yesterday, the consortium said it remained firm that its offer price of RM11 per share is an attractive offer to MAHB shareholders, as it represents a premium of 49.5% year-to-date relative to MAHB’s closing price of RM7.36 on Dec 29, 2023.
“Compared with the 10% YTD performance of the Bursa Malaysia KLCI benchmark index, the offer price premium is five times the KLCI’s performance,” it said.
Yesterday, five MAHB independent or non-interested directors said in an independent advice circular filed with Bursa Malaysia that the offer is unfair and unreasonable and recommended that shareholders reject it.
They said the offer price of RM11 represents a material discount of RM1.61 and RM2.71, or about 12.77% to 19.77%, of the value of MAHB shares between RM12.61 and RM13.71, as estimated by Hong Leong Investment Bank.
GDA said while MAHB’s most recent performance indicates positive momentum, the consortium views that the prospects represented by the non-interested directors are optimistic and unlikely to materialise without significant additional capital investment and an infusion of technical know-how.
“MAHB’s prolonged underperformance, both operationally and financially relative to peers, suggests execution of its plans will remain a challenge, and MAHB does not have a credible track record of delivery on its promises,” it said.
GDA also gave an example of the suspension of the aerotrain, saying that MAHB has been working on a replacement project from as far back as 2017 after several service failures, but the contract for the project was only awarded in December 2021 and the service has been fully suspended since March 2023.
It said prolonged underinvestment had also resulted in MAHB’s network of airports suffering in both the maintenance of core assets and systems, as well as in new projects to expand capacity.
“MAHB has also been losing significant ground in the Asean aviation market, with its market share falling from 20% to 16% from 2013 to 2023,” it said.
GDA said MAHB’s market capitalisation grew only by 12.2% while its peers in the Asia-Pacific region increased by 216.8% over the past 10 years.
“MAHB’s importance as a strategic Malaysian asset is reflected by an increase in the combined ownership in the company by UEM Group and EPF from the current 41.1% to a target of 70%, while the government continues to retain its golden share.
“The consortium looks forward to working closely with the aspiring talent at MAHB and is committed to restoring its competitive edge by ensuring talent is properly rewarded in alignment with contributions and achievements,” it said. - FMT

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