6.80 and 6.90 Tussle

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Kulim gets DPMM letter to buy QSR shares at RM6.90
Written by Joseph Chin of theedgemalaysia.com   
Tuesday, 10 January 2012 19:58

KUALA LUMPUR (Jan 10): Kulim (Malaysia) Bhd has received an offer letter from Kumpulan Syarikat Pelaburan DPMM seeking to acquire all the QSR BRANDS BHD [] shares it owns for RM6.90 per share.
Kulim said on Tuesday the offer letter from the deputy president cum chairman of Kumpulan Syarikat Pelaburan DPMM, dated Dec 30, 2011, was unsolicited.
At RM6.90, this was 10 sen above the offer made by Massive Equity Sdn Bhd (MESB) to acquire QSR’s business and undertakings, including substantially all the assets and liabilities of QSR for RM6.80 per share.
Kulim said following the latest development and offer from Kumpulan Syarikat Pelaburan DPMM, it would convene a board meeting to deliberate on the offer.
It also noted that on Dec 21, QSR’s independent directors had agreed to accept the offer from MESB to acquire QSR’s business and undertakings, including substantially all the assets and liabilities of QSR for RM6.80 per share and RM3.79 per warrant.
To recap, the boards of QSR and KFC HOLDINGS (M) BHD [] (KFCH), which accepted the joint takeover offer by Johor Corp (JCorp) and CVC Capital Partners Asia III Ltd, said on Dec 21, they were not seeking any alternative bids for the sale of their assets and liabilities.
Both companies had stated they would not invite alternative bids will put to rest speculations on possible counter bids for the fast food chain assets.
However, both companies noted that the takeover offers are subjected to “further negotiations and mutual agreement on terms and conditions to be incorporated into the definitive sale and purchase agreement”.
MESB is a special purpose vehicle created to undertake the take-over exercise to acquire all assets and liabilities in QSR and KFCH.  The shareholders of MESB are Triple Platform Sdn Bhd, a wholly-owned subsidiary of JCorp, with a 51% stake and Melati Asia Holdings Ltd, a wholly-owned unit of CVC Capital Partners, with 49%.
Currently, JCorp owns a 57.05% stake in KULIM (M) BHD [], which in turn holds 58.68% of QSR. QSR is the major shareholder of KFCH with a 50.64% equity stake.
MESB is offering RM6.80 cash per share for QSR Brands, and RM3.79 for the company’s warrants. Meanwhile, the SPV offered to buy the assets in KFCH at RM4 per share and RM1 for all its outstanding warrants.
Upon completion of the takeover exercise, both QSR and KFCH will become empty shell companies, and the two companies intend to return the bulk of the sale proceeds to shareholders through capital repayment exercises.