SIME Darby Berhad has entered into a conditional sales and purchase agreement with Permodalan Nasional Berhad (PNB) to acquire its 61.2% stake in UMW Holdings Berhad for RM3.57 bil cash or RM5 per share.
Once the agreement becomes unconditional, Sime Darby will be making a general offer for the remaining 38.8% stake that it does not hold with the aim of delisting UMW from Bursa Malaysia.
According to Sime Darby Group CEO Datuk Jeffri Salim Davidson, the deal, which will add the Toyota and Perodua brands to its portfolios, will cement the group’s position as Malaysia’s leading automotive player.
The acquisition will also complement Sime Darby’s existing premium-to-luxury portfolio, namely BMW, Rolls-Royce and Porsche.
“As a partner of choice to some of the most admired brands in the automotive sector, we are very excited to have the opportunity to work with Toyota, one of the world’s largest and most respected automakers,” he remarked in a statement today (Aug 24).
He also said the acquisition is accretive to Sime Darby’s earnings per share and will enhance Sime Darby’s shareholders return.
Sime Darby expects the acquisition of PNB’s stake to be completed within three months from the date of the sales and purchase agreement subject to regulatory and shareholders’ approvals and customary closing conditions.
With the purchase of UMW, Sime Darby gains a 38% stake in Perodua and 51% equity interest in UMW Toyota Motor Sdn Bhd.
State investment firm PNB continues to hold a 10% stake in the national marquee via PNB Equity Resources Corp Sdn Bhd (PERC). It is also the largest shareholder in Sime Darby with a 41.56% stake.
Meanwhile, PNB confirmed separately that the consolidation of the two leaders in the automotive industry is driven by opportunities to strengthen its local and regional presence in the automotive sector.
It added that the merger will also provide a boost to the electrification agenda, which is expected to drive investment growth, enhance efficiency, and create value for its unit holders.
“This strategic move is also in alignment with the government’s New Industrial Master Plan 2030, which will support the automotive sector’s further growth especially in positioning the country as the automotive hub for the region,” PNB said in a statement. – Aug 24, 2023
Main pic credit: Sime Darby