CEO Morning Brief

Sanichi Founder Offers to Take Over Computer Forms at Discount to Market Price

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Publish date: Thu, 31 Mar 2022, 10:34 AM
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TheEdge CEO Morning Brief

KUALA LUMPUR (March 31): Computer Forms (M) Bhd has received a notice of an unconditional mandatory takeover offer from major shareholder Datuk Seri Pang Chow Huat to acquire the remaining shares in Computer Forms not owned by Pang for 60 sen per share.

The offer is at a discount of 22 sen or 26.83% to Computer Forms’ last closing share price of 82 sen. The counter had jumped by 29 sen or 54.71% from 53 sen on March 16, 2022.

As at end-Dec 2021, Computer Forms’ net asset per share stood at 32 sen apiece, from RM1.10 at end-March 2021.

The offer for the company, which manufactures computer paper documents and other customised forms, was triggered on Thursday (March 31) after Pang acquired the entire 133.19 million shares or 64.97% stake owned by major shareholder Tan Sri Tan Hua Choon in Computer Forms.

The purchase was made through a direct business transaction for a total cash consideration of RM79.91 million or 60 sen per share, company filing showed.

Tan, who is exiting the company, had bought into the company in 2016 before making a takeover offer in October 2018 with at RM1.25 per share. At the time, the offer by the Casio King was at a premium of 34 sen or 37.36% premium to the group's last traded price of 91 sen as at Oct 23, 2018.

It is unclear what is Pang’s plan with Computer Forms. The group underwent five consecutive years in the red in the financial year ended March 31, 2016 (FY16) to FY20, before turning into the black with net profit of RM328,000 on revenue of RM29.3 million

In the nine-month period ended Dec 31, 2021 (9MFY22), the group booked a hefty net profit of RM61.91 million following a land sale of RM63.1 million ,while revenue fell 6.36% to RM20.15 million, from RM21.52 million.

According to company filing, Computer Forms is principally engaged in printing and distributing computer forms, stock forms and specialised forms. The company operates through five segments, namely business forms and data print services, commercial printing, flexible packaging, business of property management, and system development and implementation.

Prior to this acquisition, Pang, who is founder and group managing director of Sanichi Technology Bhd, did not hold any shares in Computer Forms.

Pang, 48, intends to maintain the listing status of Computer Forms on the Main Market, the filing added.

Across other listed entities, Pang holds 0.91% direct stake in loss-making Sanichi. Apart from that, he holds a 15.31% stake in BSL Corp Bhd and a 7.9% interest in Fitters Diversified Bhd as of March 29, 2022.

Shares in Computer Forms closed up 8.5 sen or 11.56% to 82 sen on Thursday (March 31), bringing a market capitalisation of RM168 million.

Source: TheEdge - 31 Mar 2022

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