Family Stake Acquisition Propels FACB Share Price
A conditional privatisation offer valued at RM![]()
million has been launched for FACB Industries Incorporated Bhd, initiating a strategic move to take the company private. This offer comes from Chen Yiy Fon, the current chairman and the son of the company’s late founder, aiming to consolidate control of the firm. The proposition is to acquire all shares held by his late father, Tan Sri Chen Lip Keong, his mother, and other minority shareholders, with a cash offer of RM![]()
for each ordinary share. In total, the transaction involves the purchase of approximately ![]()
million ordinary shares, excluding any treasury shares currently held by the company. The conditional offer for the shares of FACB Industries Incorporated Bhd, whose core business involves the manufacturing and sale of bedding products in Malaysia and China, is structured to remain open for acceptance for a period of ![]()
days, with an initial closing date set for August ![]()
, which is subject to extension depending on the acceptance rate. News of this substantial acquisition immediately provided a significant boost to the company’s stock, as the share price of FACB surged by ![]()
percent, or ![]()
sen, to reach RM![]()
, marking its highest trading level since ![]()
.
Details of the Takeover and Corporate Strategy
The privatisation attempt by Chen Yiy Fon is fundamentally a move to simplify the corporate structure and consolidate family ownership following the passing of the founder. The tender offer price of RM![]()
per share provides a premium to the stock’s previous trading levels and represents a clear exit opportunity for minority shareholders. As the current chairman, Chen Yiy Fon’s acquisition of ![]()
million ordinary shares is aimed at taking FACB Industries Incorporated Bhd off the public listing boards, giving the family greater flexibility in managing its assets without the immediate scrutiny and regulation required of a publicly-traded entity. The company’s business operations are diversified but centered around consumer durables, specifically the manufacturing and marketing of mattresses and bedding-related products in its home market of Malaysia under the Dreamland brand, as well as steam production and the marketing of bedding products through subsidiaries and associates located in China. This dual geographic focus highlights the regional scope of FACB’s operations, even as the corporate control is being centralized in Kuala Lumpur.
Market Response and Share Performance
The conditional nature of the takeover offer means the transaction is dependent on meeting certain acceptance thresholds from the remaining shareholders. The financial markets reacted swiftly and decisively to the news of the impending privatisation, resulting in the dramatic spike in the share price of FACB. The ![]()
percent jump in a single trading session, which saw the stock hit a ![]()
high, indicates that the offer price of RM![]()
was considered attractive and significantly above the market’s valuation at the time of the announcement. This surge reflects the market’s assessment that the bid is likely to succeed, pushing the trading price closer to the offer price as arbitrageurs and optimistic investors acquire shares expecting the takeover to complete. The strategic rationale for the privatisation, driven by the founder’s son, suggests a long-term internal restructuring plan for the bedding and manufacturing conglomerate, seeking to achieve greater operational efficiency and strategic agility away from the demands of the stock exchange.
