Double10

PERWAJA-LA should be worth RM1.02 after restructuring.

According to the Proposed Regularisation Scheme in pages 11 and 39, after haircut of 30%, the RCULS of nominal value RM1.00 will be reduced to RM0.70 a piece. So every 1 RCULS will be repaid via 3.5 new Perwaja shares @RM0.20. So if PERWAJA mother share price is RM0.290, PERWAJA-LA will be worth RM1.02 (0.290 x 3.5). It is now about 50 sen.

2015-07-24 11:52

Double10

Perwaja LA is a better trading counter than the mother share. According to the revised restructuring scheme, the RM1.00 LA will be repaid with 70 sen per LA after haircut of 30%. The 70 sen will be paid via issuance of new Perwaja shares @ 15 sen each. So for every 1 LA, you will end up with 4.67 new Perwaja shares. At today's closing price of 12 sen per mother share, the LA is theoretically worth 56 sen. That is quite easy to understand. Current depressed prices were caused by margin account forced sale by the bank, which has completed 2 weeks ago, as reported in Bursa announcements. If u look at the annual report, only about 30 million LA are floating in the market. This is really small amount. The balance 250 million tightly held by major shareholders; their original cost is RM1.00 at time of subscription. They would never sell and would go for share exchange exercise.

2016-12-09 10:12

CharlesT

Posted by Double10 > Jul 24, 2015 03:36 AM | Report Abuse

PERWAJA-LA should be worth RM1.02 after restructuring.


Last July when u posted yr first article here, LA was ard RM0.55..then it plunged all the way down to Rm0.02 in Nov 2016 and started to rebound to Rm0.09 few days ago...

Now u posted another article here saying it worth Rm0.56...What will happen next?

2016-12-09 10:29

firehawk

so terrible ....

2016-12-09 10:36

Kris Wong

all these computations are based and subjected on a successful restructuring exercise as proposed previously. If not, is not valid. It is a high risk and much higher returns bet and as a PN17 counter with huge losses it is not for the faint hearted and buyer should be aware of the risk of losing everything but gain manifold if the proposed restructuring is successful !!!

2016-12-09 11:50

Kris Wong

It is also worthwhile to note that the LA can be converted into the ordinary shares at the holders' option on a 1 to 1 basis with no further cash outlay from 26 March 2017 onwards !!!

2016-12-11 10:52

Double10

We checked with the registrar, Mega Corporate Services, they confirmed that the on-going restructuring scheme will not affect the conversion of LA into shares if holders choose to convert. So comes 27 March 2017, LA holders can submit the conversion form and after 8 market days, the shares will be credited into holders' CDS account.

2016-12-14 17:15

Double10

That means there is a 5.5 sen arbitrage opportunity at today's prices.

2016-12-14 17:16