Affin has applied to central bank to buy EON Cap
Source : http://biz.thestar.com.my/PETALING JAYA: After months of intense speculation, the board of Affin Holdings Bhd has confirmed that it has submitted an application to the central bank to seek approval for negotiations with EON Capital Bhd (EON Cap) and/or its major shareholders for the proposed buyout of the latter.
The financial group whose major shareholder is Lembaga Tabung Angkatan Tentera was responding to recent StarBiz articles yesterday and told Bursa Malaysia that it had submitted the application but the decision from Bank Negara was “still pending”.
“The board is unable to provide any details of the proposed acquisition of an interest in EON Cap as they are still subject to, among others, the approval of Bank Negara,” it said in a late evening statement to the stock exchange.
The application was made on May 4, it added.
Affin, the second smallest banking group in the country said it would make further and timely announcements once the details of the proposed acquisition had been finalised.
On Friday, StarBiz reported that Affin had sought the green light from Bank Negara to make a general offer (GO) for EON Cap and that the central bank “was assessing the deal”.
The deal would likely be a combination of cash and shares, it was reported.
In an earlier financial results statement to Bursa Malaysia yesterday, Affin’s chairman Tan Sri Mohd Zahidi Zainuddin said the group was “always on the lookout to explore possibilities to propel its business locally and regionally”.
He did not elaborate.
Affin’s name had surfaced as a possible contender for the EON Cap buoyut months ago but so far, Hong Leong Bank Bhd (HLB) is the only one which has put forward a solid cash offer for EON Cap, the third smallest bank by assets in Malaysia.
HLB’s proposed offer of RM5.06bil which works out to RM7.30 per share is thought by the board of EON Cap to be in the best interest of the group and is scheduled to be tabled before shareholders at an upcoming EGM, said to take place earliest by the end of next month.
This, despite EON Cap’s independent financial adviser, Credit Suisse Securities (M) Sdn Bhd, saying that HLB’s offer is “not fair from a financial perspective’’.
“This (Affin’s pending application) obviously creates a dilemma for HLB,” an analyst who tracks the HLB-EON Cap saga said.
Critics say Affin, given its size, may face problems in funding the proposed exercise.
“Based on our estimates, Affin would almost certainly need to raise capital should it get the green light from Bank Negara for the deal,” Hwang DBS said in a report yesterday.
Affin’s Tier-1 capital adequacy ratio would drop from 12.7% currently to below 3% (assuming the acquisition is not funded by a rights issue), Hwang DBS said. While with a rights issue, Affin would be able to restore its capital position but there would be significant dilution to earnings per share and book value at the new merged entity, based on our calculations, it said.
The Affin proposal is thought to be linked to Ng Wing Fai, a board member of EON Cap who represents Primus Pacific Partners Ltd which has a 20.2% stake in EON Cap. Because the proposed plan would involve a share option, this means that the company would not have to crystallise its losses given its high entry point investment of RM9.55 per share.
HLB’s offer on the hand is backed by the other major shareholders of EON Cap namely Rin Kei Mei and Tan Sri Tiong Hiew King who are keen sellers.
Meanwhile, Affin yesterday reported for its first quarter ended March 31 a net profit of RM135.3mil or 9.06 sen per share, 48% higher than the net profit of RM91.6mil or 6.13 sen per share recorded in the same quarter last year following higher net interest , Islamic banking and other operating income.
Revenue for the period under review stood at RM520mil against RM499mil last year.
Analysts said yesterday’s results made up 47% of full-year consensus estimates and was above expectations.
The group said it was “on track” to achieving its headline key performance indicators (KPIs) for the current financial year among which were returns on equity (8.4%), return on assets (1.0%) and net non-performing loan ratio (1.9%).
For the just concluded quarter, all three ratios stood at 2.8%, 0.3% and 3.4%. Cost-to-income ratio improved to 44% from 50% last year.
“Barring any unforeseen circumstances, the group is expected to perform well and achieve satisfactory results for FY10,” Affin said.
For the quarter under review, the increase in net interest, Islamic banking and other operating income totalled RM46mil, Affin said while allowance for impairment on loans, advances and financing was also lower compared to last year at RM8.5mil.
Its principal subsidiary, Affin Bank reported a pre-tax profit of RM139mil compared to RM100.5mil while Affin Investment Bank Bhd also reported higher pre-tax profit of RM27.9mil compared with RM16.4mil earlier.
AXA-Affin Life Insurance Bhd also reported a higher pre-tax profit of RM300,000 while AXA-Affin General Insurance Bhd made a lower pre-tax profit of RM4mil largely due to higher net claims.
Shares in EON Cap, Affin and HLB were all up by 14 sen, 2 sen and 9 sen to RM7.01, RM2.90 and RM8.55 respectively at the market close yesterday.
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Turut sahkan kemuka cadangan beli EON Capital
SUMBER : http://www.utusan.com.my/
KUALA LUMPUR 31 Mei - Affin Holdings Bhd. (Affin Holdings) mengesahkan bahawa pihaknya telah mengemukakan permohonan kepada Bank Negara Malaysia (BNM) untuk memulakan rundingan bagi membeli EON Capital Bhd.
Bagaimana, Kumpulan itu masih belum menerima sebarang keputusan daripada bank pusat tersebut, menurut Affin Holdings dalam kenyataannya di sini hari ini.
Affin Holdings berkata, pihaknya berusaha mendapatkan kelulusan untuk memulakan rundingan dengan EON Capital dan pemegang saham utamanya berhubung cadangan pembelian dalam EON Capital.
Namun ia tidak mengulas lanjut mengenai butiran tersebut.
Sebelum ini, Lembaga Pengarah EON Capital mengumumkan untuk menerima pembidaan Hong Leong bernilai RM5.06 bilion meskipun tawaran itu didakwa tidak memberi nilai setara kepada bank tersebut.
Sementara itu, Affin Bank dalam kenyataan berasingan di sini mengumumkan keuntungan sebelum cukai yang diraihnya dalam suku pertama berakhir pada 31 Mac lalu melonjak kepada RM177.3 juta, naik 47.4 peratus berbanding tempoh yang sama tahun lalu.
Affin Holdings berkata, lonjakan itu disumbangkan oleh kenaikan pendapatan faedah bersih, pendapatan perbankan Islam dan pendapatan operasi.
Pendapatan sesaham bagi suku dalam kajian adalah 9.06 sen berbanding 6.13 sen bagi suku yang sama tahun lalu manakala aset bersih sesaham pula ialah RM3.300 sehingga 31 Mac lalu.
Pengerusinya, Tan Sri Mohd Zahidi Zainuddin dalam kenyataan itu berkata, pihaknya gembira dengan pertumbuhan stabil yang dicatatkan itu dan berharap momentum sama dapat dikekalkan.
''Prestasi kewangan yang stabil ini memberi petunjuk baik, malah ia merupakan permulaan yang bagus dalam memulakan pelan strategik bagi tahun ini,'' kata beliau.
Affin Bank merekodkan keuntungan yang tinggi sebelum cukai sebanyak RM139 juta berbanding RM100.5 juta pada suku yang sama tahun lalu.
Anak syarikatnya, Affin Islamic Bank pula mencatatkan keuntungan sebelum cukai RM14.6 juta bagi suku tersebut.
Sementara, Affin Investment Bank memperoleh keuntungan sebelum cukai RM27.9 juta berbanding RM16.4 juta pada suku pertama 2009, disumbangkan oleh kenaikan dalam pendapatan operasi dan pendapatan faedah bersih.
Affin Moneybrokers Sdn. Bhd. pula merekodkan keuntungan sebelum cukai sebanyak RM0.4 juta, hasil kenaikan pendapatan bersih pembrokeran dan overhed.
Prestasi kukuh turut disumbangkan oleh perniagaan insurans dengan AXA Affin General Insurans Bhd. yang mencatatkan keuntungan sebelum cukai sebanyak RM0.3 juta dan AXA Affin Life Insurans Bhd. merekodkan keuntungan sebelum cukai sebanyak RM4 juta bagi suku kewangan semasa.
''Affin Holding sentiasa mahu meneroka peluang bagi meluaskan perniagaan kami di dalam dan di peringkat serantau,'' katanya.
