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NEWS UPDATES 30 August 2009

Malaysia’s Tradewinds to take control of rice-importer Bernas

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The plantation and sugar refining group, owned by businessman Syed Mokhtar Al-Bukhary, wants to take control of Bernas for 526 million ringgit (1$=3.52 ringgit), the Business Times newspaper reported.

Tradewinds (M) Bhd has proposed to take control of Padiberas Nasional Bhd (Bernas) for 526 million ringgit as it seeks to expand and ensure the rice importer is owned by Malaysians. Syed Mokhtar Al-Bukhary also holds about 30.8 per cent of Bernas.

However, Hong Kong-based Wang Tak Co Ltd is the single largest shareholder with 31.52 percent and this has raised concern as to whether Bernas should have such a large foreign investor given its strategic national importance. Bernas holds the sole licence to import rice into Malaysia.

Tradewinds told Bursa Malaysia, the country’s stock exchange, that it plans to buy 53.76 percent of Bernas for 526 million ringgit, or 2.08 ringgit a share. Tradewinds will buy all of Wang Tak's shares and another 22.24 percent from Gandingan Bersepadu Sdn Bhd. It plans to use bank loans to buy the shares.

The company will also ask for a waiver from having to buy the rest of Bernas on grounds of national interest.

"Our national interest is the overriding factor in the proposed exercise, but we also anticipate tremendous business synergies by eliminating duplication of resources, enhancing cost-savings initiatives and allowing both companies to leverage on existing business infrastructure.

After the takeover, the firms will have a market capitalisation of close to 3 billion ringgit, he added. Maybank Investment Bank Bhd is the main adviser for the exercise, while Hwang DBS Investment Bank Bhd is the independent adviser. Tradewinds expects to complete the deals by fourth quarter.


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