The proposed merger between IJM Land Bhd and Malaysian Resources Corporation Bhd (MRCB) has been scrapped as both parties were unable to reach an agreement on the definitive terms of the proposed merger.

'Accordingly, the company wishes to announce that the proposed merger between MRCB and IJM Land is now aborted,' IJM said in a filing to Bursa Malaysia today.

MRCB also made a similar announcement to the stock exchange.

MRCB said that both companies were not able to reach an agreement after a series of discussions.

'As such, the MOU between MRCB and IJM Land on the proposed merger, dated Nov 23, 2010, shall terminate and cease to have any further effect,' the statement added.

If the merger had gone through it will have created the country's second largest property player after the enlarged UEM Land Holdings Bhd, with a market capitalisation exceeding RM7 billion and a landbank of over 3,642 hectares.

Under the earlier proposed now aborted merger plan, shareholders of both companies were to exchange their shares for that of a new merged company, which was to be listed after the second-quarter of 2011.

The non-binding offer price for IJM Land and MRCB were pegged at RM3.65 and RM2.30, with premiums of 18.5 per cent and seven per cent, respectively, over their then last traded prices.

At the proposed take-over prices, IJM Land was valued at 2.43 times book and MRCB at 2.61 times book, based on their net assets per share of RM1.50 and 88 sen, respectively, as at Sept 30.

IJM Land dipped 38 sen to RM2.86 while MRCB was last traded at RM1.99, down six sen.

Both counters, which was suspended at 11.34pm, will resume trading on Monday, Jan 3, 2011. - BERNAMA