Malay traders want sale of Shell Refinery stopped

Transaction represents a huge discount of 63.6 per cent to Shell Refining Company’s last traded price of RM4.94 on January 29 before the announcement of the deal was made.

KUALA LUMPUR: The Malaysian Malay Businessmen and Industrialists Association (Perdasama) wants the regulatory authorities to stop the sale of Shell Refining Company (Federation of Malaya) Bhd (SRC) at a huge discount to a foreign company.

“We reiterate that the deal would leave its Malaysian shareholders with massive losses,” said its President Moehamad Izat Emir.

“Perdasama regards SRC with its refinery plant in Port Dickson as not just any other company but a national asset responsible for refining about 30 per cent of the country’s crude oil production and as such, it should not be sold to a foreign company.”

“Perdasama would like to appeal to the Securities Commission, Bursa Malaysia and the Minority Shareholders Watchdog Group to assume their respective roles by seriously scrutinising the deal in the interest of shareholders.”

He noted that some 30 per cent of SRC was owned by local institutions such as Permodalan Nasional Bhd (PNB), the Employees’ Provident Fund (EPF) and Kumpulan Wang Amanah Pencen (KWSP).

“The transaction, which is subject to regulatory approval, represents a huge discount of 63.6 per cent to SRC’s last traded price of RM4.94 on January 29 before the announcement of the deal was made,” said Izat Emir.

On Monday, global oil giant Royal Dutch Shell announced it had signed a deal to sell its entire 51 per cent stake, or 153 million shares, in SRC to Malaysia Hengyuan International Ltd (MHIL) of China for a total cash consideration of USD66.3 million, which represented an offer price of 43 US cents per share.