Petronas Raises Offer for LNG Shipper MISC Berhad

Image: MISC Berhad

(Bloomberg) — Petroliam Nasional Bhd., Malaysia’s state oil and gas company, raised its buyout offer for shipping group MISC Bhd. by 3.8 percent to $3 billion after minority shareholders complained its initial bid was too low.

Petronas, as the energy group is known, increased its offer for the world’s second-largest liquefied natural gas shipping company to 5.50 ringgit per share from 5.30 ringgit, according to a stock exchange filing by Kuala Lumpur-based MISC today. The offer values the stake Petronas doesn’t already own at 9.16 billion ringgit ($3 billion), up from 8.8 billion ringgit previously, according to Bloomberg calculations.

The state energy company, which already owns 62.7 percent of MISC, had acceptances from 7.6 percent of shareholders at the lower price after extending its deadline to today from March 19, according to a separate exchange filing today. The new offer is open till April 19 with the higher price available to those who bid earlier, the shipping company said.

Azlan Zainol, chief executive officer of Malaysia’s Employees Provident Fund, called on Petronas to raise its offer in a March 7 interview. EPF, the country’s biggest pension fund, is MISC’s second-biggest shareholder with a 9.6 percent stake. Minority stakeholders Penang Development Corp. and Pacific Mutual Fund Bhd. earlier also told Bloomberg News that the original offer undervalued the company.

MISC fell 0.7 percent to close at 5.46 ringgit before today’s announcements.

Indicative Valuation

Independent adviser AmInvestment Bank Bhd. described that bid as “not fair but reasonable” in a March 8 report, urging minority shareholders to either accept the offer or sell in the open market if they could secure a higher price. Indicative valuations for the shipper range from 5.69 ringgit per share to 6.10 ringgit, it said.

MISC shut its container-ship business last year to focus on LNG tankers after the cargo-box unit made losses of $789 million over three years due to global overcapacity and falling rates. It reported fourth-quarter net income of $231.9 million, recovering from a $571.6 million loss during the same period a year earlier.

The group operates the world’s biggest fleet of LNG ships after Qatar Gas Transport Co., according to Clarkson Plc, the world’s largest shipbroker.

– Barry Porter, Copyright 2013 Bloomberg.

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