Saturday, August 3, 2013

Iris

Felda to buy 25pc Iris stake at premium
By Francis FernandezPublished: 2013/08/03


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KUALA LUMPUR: Iris Corp Bhd's shareholders got a pleasant surprise yesterday when it emerged that the Federal Land Development Authority (Felda) wants to buy some 394.09 million of the company's new shares at a 40 per cent premium.

The new shares are being priced at 28 sen a piece, much steeper than its last traded price of 21.5 sen share.

Dealers say Iris could rally next week if "toppish" global equity markets start steep climbdowns in the very near future.

"It's an early Raya festive cheer for Iris shareholders, and it's also good for the retail market, which is always looking to punt on penny stocks," said a dealer at RHB Securities.

Iris' major shareholders are Datuk Tan Say Jim, who has a combined direct and indirect stake of 10.97 per cent in the company, followed by Perbadanan Nasional Bhd with a 8.39 per
cent direct stake.

The move will help bring in some RM110.3 million to the coffers of Iris which, in 2008, made global headlines when it was subject to an international stock manipulation probe.

This had led to the Malaysian stock market regulators suing US-based hedge fund Aeneas Capital Management LP for market rigging and fraud.

In a statement to Bursa Malaysia, Iris said Felda wrote to the company on Thursday offering to buy the new Iris shares.

The Iris board yesterday accepted the offer, which will would see Felda holding a 25 per cent stake in the public-listed company.

The deal will likely return Iris to the limelights, although whether its stock could once again scale the heights that saw it trade at the RM1.30 level less than a decade ago is debatable.

Iris is one of the top smartcard providers in the country and has trusted identification contracts from Malaysia's e-Passport inlays, Nigeria e-Passport inlays, Tanzania's e-ID cards project
and Bangladesh's MRP Passport project.

The company's net profit for the year ended March 31 2013 fell 43.38 per cent to RM21.07 million from RM37.22 million previously, due partly to higher research and development expenditures in the food and agro technology division.

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