Stock Name: HLBANK
Company Name: HONG LEONG BANK BHD
Research House: OSK



OSK Research Sdn Bhd is maintaining a "buy" call on Hong Leong Bank Bhd, saying, any share price weakness should be seen as an opportunity to accumulate.

OSK Research also said the completion of the deal with regard to the proposed takeover of EON Capital Bhd's assets and liabilities, would prompt it to raise the target price for HLBB to RM9.80.

"The acquisition will be EPS (earnings per share), ROE (return on equity) and book value-accretive to an enlarged HLBank, even without factoring in any merger synergies," OSK Research said in latest research note today.

It however, maintained a "neutral" call on EONCap shares.

EONCap yesterday received an approval of 97 per cent of the voting shares at an extraordinary general meeting (EGM) to consider the proposed acquisition of the group by HLBB for RM5.06 billion.

"The tabling of the offer at an EGM even before the court makes a decision, implies that the board is confident of securing the necessary majority support from shareholders, to see the deal through.

"It is also unfazed by Primus' pending legal suit, which would only serve to delay the deal," the research house said.

It said the completion of the HLBank-EONCap deal could only be ascertained and finalised by end-2010.

This is because the deal, is contingent on the final decision of the court hearing, which would only be made known by end-2010. - Bernama