KUALA LUMPUR (July 18): After hitting a record high of RM1.46 a share on Monday (July 17), shares of Ewein Bhd slumped by 5.48% or eight sen to close at RM1.38 on Tuesday (July 18) following an independent adviser's recommendation that shareholders reject an unconditional mandatory takeover offer for the company.

At RM1.38 apiece, Ewein's share price is still at its second-highest ever, and has a market capitalisation of RM416.19 million.

A day earlier, independent adviser UOB Kay Hian Securities (M) Sdn Bhd (UOBKH) labelled the unconditional mandatory takeover offer for Ewein as "not fair and not reasonable" and advised shareholders to reject the deal, given the steep discount of more than 40% of the stock's estimated value.

UOBKH said the offer price of 60 sen per share is not fair as it represents a discount of 44 sen or 42.31% to the estimated value of Ewein shares derived using the sum-of-parts valuation methodology of RM1.04. It also said it is not reasonable as the offeror intends to maintain Ewein’s listing status on Bursa Malaysia's Main Market.

Opening at RM1.48, the counter plunged as much as 13.7% or 20 sen to RM1.26 during intraday trade. In the morning, Ewein was also the fourth highest loser by value among stocks on Bursa Malaysia.

Ewein saw a total trading volume of 17.24 million shares on Tuesday.

On June 14, NationGate Holdings Bhd’s managing director and major shareholder Ooi Eng Leong said he planned to acquire all the remaining 149.01 million shares or 49.41% of Ewein not already owned by him and persons acting in concert (PAC) — Datuk Seri Hong Yeam Wah and Goh Kiang Teng — for RM89.41 million.

Ooi made the offer after raising his stake in Ewein to 43.82% from 3.84%, after buying a 39.99% stake from Hijauwasa Sdn Bhd for RM72.36 million. Collectively, Ooi and the PACs own 50.59% of Ewein.

The offer will remain open for acceptance until July 26, unless extended.

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Independent adviser says NationGate MD’s Ewein takeover offer not fair, not reasonable