Kenanga IB said the takeover bid by the Lim family-controlled gaming and resort operator is “not fair” and “not reasonable”.
The independent adviser for GENM stated this in a circular filed with Bursa Malaysia earlier today.
It said the offer is not fair as it is below GENM’s sum-of-parts valuation, and not reasonable as investors may have the opportunity to realise their investment via the open market.
It highlighted investors could still sell their shares on the open market if they reject the offer, given Genting needs 90% of shares to delist the group, and is pursuing a New York casino licence for a US$5.5 billion (RM22.71 billion) resort in Queens.
Kenanga IB said the RM2.35 a share offer represents a discount of between 32.47% and 37.67% to GENM’s shares’ estimated value of RM3.48 and RM3.77, and a 3.69% and 19.52% discount to its one-year and two-year high market prices.
It also noted the shares are relatively liquid, with a two-year average monthly trading volume of 219.21 million shares (representing 8.08% of free-float).
GENM’s non-interested directors, except for non-executive chairman Mohd Zahidi Zainuddin, who is an indirect major shareholder of Kenanga IB, agreed with the adviser’s opinion that the offer is not fair and not reasonable.
The offerors owned 52.13% of GENM as of Nov 6 and needs another 37.87% to delist the company. Genting held a 49.36% stake in the company when the offer notice was issued on Oct 13.
The offer’s closing date is on Nov 24, but it can still be extended.
The stock closed unchanged at RM2.35, valuing the company at RM13.95 billion.
GENM holds the flagship Resorts World Genting that draws tens of millions of visitors annually. It also operates the group’s key operations in the US and UK.
Genting executive chairman Lim Kok Thay and his son and deputy CEO, Lim Keong Hui, collectively have a deemed interest of 44.84% in Genting as of April 15, 2025, via their family investment vehicles Kien Huat International Ltd and Kien Huat Realty Sdn Bhd.
According to GENM’s 2024 annual report, Kok Thay, 73, and Keong Hui, 40, had a deemed interest of 49.35% in the group as of March 17, 2025. Kok Thay is the son of Genting group founder Lim Goh Tong.