So says the headline on Saturday’s Business Times.
Buyer – TMC Life – a listco in KL Bourse
Seller – Best Blend – 70% owned by Mr Peter Lim and 30% by Johor crown prince Tunku Ismail Idris Ibni Sultan Ibrahim.
Consideration – RM$400m in 533.3 million new TMC shares at RM0.75 each, together with 266.7 million free warrants.
Story or “Spin” – This deal is in line with TMC’s plan to expand beyond the Klang Valley and will transform it into a major healthcare player in Malaysia.
Strategy – First develop an asset outside the listco. Upon maturity, “sell” the asset to the listco. The majority shareholders would be able to extend its majority stake in listco. The minority shareholder of the selling entity would be able to encash out. The minority shareholders of the buying entity would be in the least enviable position but they are being “compensated” by some “free” warrants.