The independent advisor appointed by Genting Malaysia to review the voluntary takeover offer put forward by its parent Genting Berhad has recommended the company reject the offer, with analysts suggesting a full takeover may be difficult to achieve given financial impediments that may prevent an improved offer.
Kenanga Investment Bank, the independent advisor in question, concluded that Genting Berhad’s offer of MYR2.35 per share was not fair and not reasonable because it represents a discount of between 32.47% and 37.67% to the intrinsic value of the shares as calculated through a sum-of-parts valuation. This, it explained, is because it fails to adequately price in Genting Malaysia’s existing gaming assets and future earnings prospects from its bid to win a full commercial license for Resorts World New York City, which it is favored to achieve.
