Gateway Development Alliance (GDA), which also comprises EPF, Global Infrastructure Partners (GIP) and Abu Dhabi Investment Authority (ADIA), had previously claimed that MAHB’s “operational and financial underperformance” will continue if it remains listed.
It argued that MAHB’s transformation is best undertaken as a private entity, supported by strategic and financial investors able to take a long-term approach to decision-making and capital investment.
The consortium plans to delist MAHB on the successful conclusion of its takeover bid.
“We do not necessarily think that there will be undue added pressure (on GDA to deliver on its promise to transform MAHB),” said Imran Yassin Md Yusof, research head at MIDF Research, which has recommended that investors accept GDA’s RM11 offer price.
He anticipates that a successful takeover will be positive for the airport operator. “There is already the need for crucial investment in the coming years for airports expansion and development as they gear up to meet growing passenger traffic demand.
“This capex is crucial to ensure that airports in Malaysia are able to maintain and improve their competitiveness,” he said.
On the role that GIP and ADIA will play in MAHB’s transformation, Imran said any partner with expertise and experience should be welcomed as this will support the efforts for any transformation.
“Note that GIP has extensive experience in managing and operating airports globally and their track record includes successful investments in major infrastructure projects,” he pointed out.
The proposed takeover had previously faced criticism from opposition politicians due to New York-based GIP’s link to asset management giant BlackRock, which has been accused of involvement in the Israel-Palestinian conflict.
BlackRock was then in the midst of purchasing GIP and completed the acquisition last October.
Some shareholders have also expressed concerns that the buyout offer was undervalued, leading to five independent MAHB directors recommending shareholders reject the offer.
Not a done deal yet
GDA’s protracted takeover bid is not in the bag yet but its latest move to lower the minimum acceptance level to 85% from 90% adds more certainty to the outcome, said analysts.
It has garnered 86.5% of the total issued shares, just 3.5% shy of the 90% acceptance rate. All other terms and conditions of the offer remain the same including the offer price of RM11 per share.
The deadline to accept the offer was also extended to Feb 4 from Jan 24. Prior to the latest move, the deadline for acceptance by shareholders had been extended twice.
“We’re not sure if it is a done deal, but the move to lower the minimum acceptance level to 85% does add certainty to the transaction. Essentially, there is no reverse by GDA once the offer becomes unconditional,” Imran said.
He said, if the offer is still conditional, GDA has the option to call off the privatisation exercise, reasoning that its condition of having 90% acceptance is not met.
However, the consortium expects to shortly declare the offer unconditional given it already has acceptances totalling 86.5% and is confident it will soon exceed 90%.
RHB Research equity research analyst Syahril Hanafiah concurred that the lowering of the acceptance threshold to 85% gives more certainty the deal will become unconditional, considering the current acceptance rate of 86.5%.
“If the deal becomes unconditional, those who have accepted the offer can no longer back out of the deal,” he said.
Moving forward, Syahril said MAHB – as a national asset with critical infrastructure – would still be required to perform in the interest of the nation and people, whether or not it gets delisted.
However, a delisting happens only if GDA hits the 90% acceptance level.
Under Bursa Malaysia regulations, companies must have a public free float of at least 25%. If it is less than 10%, which means 90% of the shares are held by shareholders acting in concert, the shares will be suspended.
After attaining the 90% acceptance level, a company can apply for delisting. The proposal will need the approval of 90% of the shareholders.
However, even if GDA fails to garner 90% of acceptance, Imran thinks it will eventually achieve its goal of delisting the company.
“There are other paths to delisting,” he added, without elaborating.