CMSB increases K&N Kenanga stake by 4%
Cahya Mata Sarawak Berhad acquired a further 25 million shares at a price of 85 sen per share in K&N Kenanga Holdings Bhd.
The acquisition is equivalent to another 4.08% stake and brings CMSB's total direct and indirect stake to 29.64% in the company.
“Kenanga represents a strategic investment by CMSB to ride on the growth of the financial services sector and would serve as a platform for CMS to expand its businesses outside the state of Sarawak,” said CMSB.
CMSB is the single largest shareholder of K & N Kenanga, which is mainly involved in stockbroking and investment banking businesses.
CMSB said that the purchase of shares in Kenanga would mitigate the impending dilution resulting from the acquisition of ECM Libra Investment Bank by Kenanga Investment Bank, a wholly-owned subsidiary of Kenanga.
The acquisition of ECM Libra IB by Kenanga IB would be partly satisfied via the issuance of 120 million new shares in Kenanga, which will dilute the shareholdings of existing shareholders of Kenanga.
“CMS's current stake in Kenanga will be diluted from 29.64% to 24.78% upon completion of acquisition,” it said.
“As a sign of confidence in its strategic investment in Kenanga, CMSB has recently increased its existing stake in Kenanga, through purchase of Kenanga shares via open market and direct business transactions," said CMSB group managing director Datuk Richard Curtis.
Kenanga Investment Bank is set to become Malaysia's largest independent investment bank and one of the country's top three brokerage houses with the largest remisier network.
The acquisition is expected to be completed in the fourth quarter of 2012.
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