Wing Tai Malaysia (Wing TM) has offered to privatise the company with the current controlling shareholder offering the shares at 50% discount from the fair value of RM3.55 to RM3.59.

The summary is here or alternatively one can read the full detail of the advise from Mercury Securities here. I really have doubt over the appointment of the adviser as it is really a small outfit and moreover Mercury is originally from Penang. So was Wing Tai which was Dragon Phoenix many years ago.

Wing TM is currently trading at around the offer price of RM1.80 which means that there has been some buying (by some parties) and the potential of it reaching 90% for compulsory takeover is very high given that there are very loose shareholders in its Top 30 except for the largest shareholder which on paper holds more than 66% - i.e. the Cheng family.

One should take note of the intrinsic value which is below.

I am wondering on the rationale that is provided i.e. lack of trade volume and the offer is a premium from its historical price trade. That is obvious isn't it as who would sell if it is below or at the market price. Just read the rationale provided by Mercury below.


However, no matter what it is I believe that Wing Tai's controlling shareholders and insiders have accumulated enough and it is a difficult fight to keep it afloat and there is no guarantee that the management is going to treat one fairly anyway after this. One less of these kind of company in Bursa Malaysia is for a healthier exchange.

Also, in the future if Mercury provides advise again, do be careful as apparently they also advised on The Store deal.