Non-interested directors of Malaysia Airports Holdings Berhad (MAHB) are not happy with the proposed takeover of the airport operator at RM11 per share, amid widespread criticism that the company is grossly undervalued.

Meanwhile, Hong Leong Investment Bank (HLIB), appointed as independent adviser for the deal, said the RM11 per share offer by Gateway Development Alliance Sdn Bhd (GDA) was "not fair" but "reasonable" and recommended that shareholders accept the offer.

GDA, a consortium comprising Employees Provident Fund (EPF), Abu Dhabi Investment Authority and BlackRock-owned Global Infrastructure Partners (GIP) has offered to acquire MAHB for the remaining 1.12 billion MAHB shares at RM11 per share.

MAHB’s independent directors, however, strongly opposed the offer, saying it undervalues the company’s assets and growth potential, especially given the company's critical role in the Malaysian aviation sector and its extensive airport network, including Istanbul Sabiha Gökçen International Airport in Turkey.

"As such, all of the non-interested directors are of the opinion that the offer is not fair and not reasonable and they recommend the Holders to reject the offer," reads an independent advice circular published today.

The non-interested directors of MAHB include independent non-executive directors Mohamad Husin, Ramanathan Sathiamutty, Cheryl Khor Hui Peng, Koe Peng Kang and Chris Chia Woon Liat.

They say the RM11 per share represents a discount of RM1.61 and RM2.71 or about 12.77% to 19.77% to HLIB's estimated value per MAHB share of between RM12.61 and RM13.71.

In August, they appointed global financial adviser UBS AG Singapore (UBS) to assess the value of MAHB shares.

UBS shared the directors' view that the offer price is unfair.

The bid, facilitated by AmInvestment Bank Berhad, involves GDA, Pantai Panorama Sdn Bhd, Kwasa Aktif Sdn Bhd and GIP Aurea Pte Ltd, collectively referred to as the joint offerors.

The joint offerors claim that the acquisition is aimed at modernising MAHB’s operations, improving connectivity and enhancing passenger experience.

They have also agreed not to lay off staff or undertake any significant restructuring of MAHB’s workforce.

The proposed acquisition seeks to privatise MAHB, which manages 39 airports in Malaysia and one in Turkey, including Kuala Lumpur International Airport (KLIA).

MAHB was thrust into political controversy after Prime Minister Anwar Ibrahim, who is also finance minister, refused to back down from his decision to sell its shares to GIP, a company owned by BlackRock, the US investment giant which is facing allegations of complicity in Israeli war crimes.

Pro-Palestinian groups and opposition leaders have repeatedly warned Anwar against the deal, saying it contradicts his various statements condemning Israeli atrocities in Gaza, which have so far claimed at least 50,000 lives.

Sovereign fund Khazanah Nasional stated that it would increase its stake in MAHB from 33.2% to 40% and in EPF from 7.9% to 30% upon completion of the transaction. Khazanah further explained that Malaysian investors would own 70% of MAHB, while ADIA and GIP would hold the remaining 30%.

https://www.malaysianow.com/news/2024/12/20/mahb-independent-directors-reject-unfair-takeover-offer