KUALA LUMPUR (Aug 3): Pasdec Holdings Bhd shareholders have been told to reject the takeover bid launched by its substantial shareholder Datuk Seri Tew Kim Thin, which has been deemed "not fair and not reasonable" by independent adviser Public Investment Bank Bhd (PIVB).

Tew, who is an executive director of Pasdec, is proposing to pay 52.5 sen per share for the remaining 228.41 million shares, or a 57.05% stake, he does not own in the Kuantan-based property developer, as well as one sen per warrant for the remaining 35.78 million warrants, or 31.28%, of the total number of warrants in Pasdec.

In an independent advice circular today, PIVB said although the share offer price represents a premium ranging from 1.98% to 31.71% over the last traded price of Pasdec shares as at July 2, 2018 of 47 sen and the five-day, one-month, three-month, six-month and 12-month volume-weighted average market price (VWAMP) of Pasdec shares, it, however, is lower than the estimated revalued net asset value (RNAV) per Pasdec shares of RM2.11, which represents a substantial discount of RM1.585 or 75.12% to the estimated RNAV per Pasdec share.

Premised on this, PIVB deems the share offer price not fair.

The warrant offer price is also not fair in view that it is at a 90% discount to the theoretical value of the warrant as at July 2, 2018. It also represents a substantial discount of 90% and 90.79% over the last traded price of the warrants as at July 31, 2018 of 10 sen and the five-day VWAMP of 10.86 sen.

The independent adviser said the offer is also not reasonable, considering that the offeror intends to maintain Pasdec's listing status, which means that shareholders will still be able to participate in the trading of Pasdec's shares and warrants.

"In the event that Pasdec declares any distributions in the future, shareholders are entitled to receive the distributions," it added.

"Premised on these, we are of the opinion that the offer is not fair and not reasonable. Accordingly, we advise and recommend that shareholders to reject the offer," said PIVB.

In a filing with Bursa Malaysia today, Pasdec's board of directors concurred, advising shareholders to reject the takeover offer by Tew.

On July 3, Pasdec had received a conditional mandatory general offer (MGO) from Tew through his private investment vehicle Jasa Imani Sdn Bhd, after his shareholding increased to 38.61% from 27.98% following the subscription of rights shares with warrants in the group. Together with the persons acting in concert with the offeror, their collective shareholdings increased to 42.26% from 31.68%.

Pahang State Development Corp, which owns a 26.57% stake in the group, has irrevocably undertaken not to accept the MGO.

Pasdec shares ended the morning session unchanged at 52 sen today, with 53,000 shares done, bringing a market capitalisation of RM208.19 million.