There are two companies will be privatised soon. Those companies are NSTP and Sarawak. Announcement of privatisation for both companies has been made on 16 and 19 October respectively. The price of both counters has reacted differently after the announcement.
As for NSTP, the price was down, open lower and closed at RM2.09 compared to RM2.46 before announcement. It has lost at RM0.35.
Conversely, Sarawak price has reacted differently where it was open higher at RM2.60 compared to RM2.14 before announcement and gain at RM0.56.
In most previous cases, privatisation made the price gain, and Sarawak case included, but in NSTP case privatisation has made the price loss. Why?
The answer is valuation of the price after upon announcement. NSTP has been valued at RM2.00 compare to RM2.46 market price., where as Sarawak had been valued at RM2.65 compared to RM2.14 market price.
As for current NSTP’s minority shareholders they will be paid in form of share swap. They will get one Media Prime share for every one NSTP share together free warrant of Media Prima at ratio 1 for 5.
The question is, what price of Media Prima after NSTP’s privatisation? Can shareholders sell it at RM2.00 (as swapped by Media Prima) where as the current market is only RM1.80. Can Media Prima’s price increase to RM2.00 after NSTP’s privatisation?
Different situation will be faced by Sarawak current shareholders. If they accept the privatisation offer, they will get RM2.65 per share and they will be paid in cash. The offer is certain.
There is another different scenario here. NSTP’s NTA is RM4.06 where as Sarawak’s NTA is RM1.88.
Looks like NSTP’s current shareholders offered lower than NTA compared to Sarawak current shareholders. Minority Shareholders Watchdog (MWSB) should object this matter.
Or, should current shareholders of NSTP sell the shares?
From my point of view, they should sell as long as gain by taking in account the Media Prima (NSTP swapped share) price which is uncertain.
- Sabri Jalil
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