1. INTRODUCTION
The Board of Directors ("Board") of EON, wishes to announce that HICOM Holdings Berhad ("HICOM"), which owns 79.05% equity interest in EON as at 21 March 2008, has proposed to the Board of EON via a letter dated 24 March 2008 for EON to undertake a voluntary withdrawal of its listing from the Official List of the Main Board of Bursa Securities pursuant to Paragraph 16.04 of the Listing Requirements of Bursa Securities ("Listing Requirements"). As required under Paragraph 16.05 of the Listing Requirements and in conjunction with the Proposed De-Listing, HICOM will extend a voluntary general offer to acquire the remaining 52,147,493 ordinary shares of RM1.00 each representing approximately 20.95% of the issued and paid-up share capital of EON ("Offer Shares") not already held by HICOM, at an offer price of RM2.10 per share ("Proposed Exit Offer").
The proposal by HICOM is in line with the intention to take steps to request for the withdrawal of EON’s listing status as stated in the offer document dated 21 November 2007 in relation to the then mandatory offer extended by Aseambankers on behalf of HICOM on all the EON Shares not held by HICOM then (“Offer Document”).
The Directors of EON (save for Y. Bhg. Tan Sri Ab. Rahman Bin Omar, Y.Bhg. Datuk Haji Mohd Khamil Bin Jamil and Encik Mohd Redza Shah bin Abdul Wahid (“Common Directors”) who are also directors of HICOM) having reviewed the Proposed De-Listing and Proposed Exit Offer and taking into consideration the reasons set out in the letter dated 24 March 2008, in particular the outstanding issue of non-compliance with the public shareholding spread requirements under the Listing Requirements, have agreed to present the Proposed De-Listing to the shareholders of EON at an extraordinary general meeting (“EGM”) to be convened.
2. DETAILS OF THE PROPOSED DE-LISTING AND THE PROPOSED EXIT OFFER
2.1 Requirements of the Listing Requirements
Under Paragraph 16.05 of the Listing Requirements, EON may not request for the withdrawal of its listing from the Official List of Bursa Securities unless the Company complies with the following conditions:
(a) EON convenes a general meeting to obtain the approval of its shareholders;
(b) The resolution for the withdrawal of its listing is approved by a majority in number representing three fourths in value of EON’s shareholders present and voting either in person or by proxy at the meeting and provided that such shareholders who object to the withdrawal is not more than 10% of the value of the shareholders present and voting either in person or by proxy;
(c) EON’s shareholders are offered a reasonable cash alternative or other reasonable alternative;
and
(d) EON appoints an independent adviser, which meets the approval of the independent directors, to advise and make recommendations for the consideration of the shareholders, in connection with the Proposed De-Listing as well as the fairness and reasonableness of the Proposed Exit Offer.
Upon fulfilment of the above, EON will submit an application to Bursa Securities to request for the withdrawal of its listing from the Official List of Bursa Securities pursuant to Paragraph 16.06 of the Listing Requirements.
2.2 Requirements of the Malaysian Code on Take-Overs and Mergers, 1998 ("Code")
The Proposed Exit Offer in conjunction with the Proposed De-Listing constitutes a voluntary general offer under the provisions of the Code. As such, the implementation of the Proposed Exit Offer will comply with the provisions of the Code.
The Securities Commission ("SC") had, via its letter dated 13 March 2008, approved the application for a waiver by Aseambankers Malaysia Berhad on behalf of HICOM from complying with Section 12(2) of the Code and had approved that the provision of Section 12(2) of the Code shall be complied by HICOM after the approval of the shareholders of EON for the Proposed De-Listing has been obtained. In this regard, HICOM will serve the notice of the Proposed Exit Offer to the Board of EON on the same day after the approval of the shareholders of EON for the Proposed De-Listing, in accordance with the requirements of Paragraph 16.05 of the Listing Requirements, is obtained at an EGM to be convened.
2.3 Terms of the Proposed Exit Offer
2.3.1 Proposed Exit Offer
Subject to the approval of EON’s shareholders for the Proposed De-Listing at an EGM to be convened, HICOM will extend the Proposed Exit Offer to purchase all the Offer Shares not held by HICOM.
Under Section 34 of the Securities Commission Act, 1993 (“SCA”), if HICOM receives acceptances of not less than 90% of the Offer Shares pursuant to the Proposed Exit Offer (other than EON Shares already held at the date of the Proposed Exit Offer by HICOM), HICOM would be entitled to compulsorily acquire any remaining Offer Share for which acceptances have not been received under the Proposed Exit Offer. It is the intention of HICOM to invoke Section 34 of the SCA to compulsorily acquire such remaining Shares.
2.3.2 Consideration
Under the Proposed Exit Offer, HICOM will pay a cash payment of RM2.10 per Offer Share. The total cash consideration payable by HICOM for the purchase of the Offer Shares will depend on the level of acceptances to be received pursuant to the Proposed Exit Offer. Assuming all the holders of the Offer Shares accept the Proposed Exit Offer, the maximum cash payable by HICOM pursuant to the Proposed Exit Offer will be approximately RM 109.51 million.
2.3.3 Conditions of the Proposed Exit Offer
The Proposed Exit Offer is not conditional upon valid acceptances being received in respect of any minimum number of Offer Shares. However, the Proposed Exit Offer will be conditional upon the approvals to be obtained as set out in paragraph 5 of this announcement.
2.3.4 The Offer Price
The offer price of RM2.10 per Offer Share (“Offer Price”) reflects the offer price made pursuant to the mandatory offer by HICOM to acquire all the remaining ordinary shares, not already owned by HICOM and persons acting in concert with HICOM, in accordance with the terms and conditions as set out in the Offer Document dated 21 November 2007 (“Offer”), which had closed on 18 January 2008.
3. RATIONALE FOR THE PROPOSED DE-LISTING
HICOM, in its proposal to the Board of EON, reaffirmed their intention as set in the Offer Document that HICOM does not intend for EON to comply with the shareholding spread requirements and will take steps to request for the withdrawal of EON’s listing status under paragraph 16.04 of the Listing Requirements.
Based on EON’s Record of Depositors as at 18 January 2008, the Company has a public shareholding spread of 8.83% held by 2,701 public shareholders. Although EON continues to meet the minimum number of 1,000 shareholders, there is a spread shortfall in terms of the 25.00% public shareholding spread pursuant to paragraph 8.15(1) of the Listing Requirements.
In view of the above, pursuant to paragraph 8.15(4) of the Listing Requirements, Bursa Securities had suspended the trading of EON Shares on the Main Board of Bursa Securities on 11 March 2008.
The Proposed Exit Offer is in conjunction with the Proposed De-Listing where shareholders will be provided with a cash consideration of RM2.10 per share for the Proposed Exit Offer.
4. EFFECTS OF THE PROPOSED DE-LISTING
4.1 Issued Share Capital
The Proposed De-Listing will not have any effect on the issued and paid-up share capital of EON, save that the shares of EON will no longer be listed.
4.2 Major shareholder’s shareholdings
The Proposed De-Listing will not have any effect on the major shareholder’s shareholdings. However, the Proposed Exit Offer to be extended in conjunction with the Proposed De-Listing, if accepted in full or to the extent that HICOM is able to invoke the compulsory acquisition under Section 34 of the SCA, will result in EON becoming a wholly-owned subsidiary of HICOM.
4.3 Earnings, net assets and gearing
The Proposed De-Listing will not have any effect on the earnings, net assets and gearing of EON and its subsidiaries for the financial year ending 31 March
2008.
5. CONDITIONS
The Proposed De-Listing and Proposed Exit Offer are subject to the following approvals being obtained:
(a) shareholders of EON in accordance with the requirements of Paragraph 16.05 of the Listing Requirements at an EGM to be convened for the Proposed De-Listing;
(b) Bursa Securities for the withdrawal of the listing of EON from the Official List of Bursa Securities; and
(c) any other relevant authority; where applicable.
The Proposed Exit Offer is in conjunction with the Proposed De-Listing and will be a conditional offer upon serving of the notice until the approval-in-principle of Bursa Securities is obtained. The Proposed Exit Offer will not be extended if the shareholders of EON do not approve the Proposed De-Listing at the EGM to be convened.
6. DISCLOSURE OF INTERESTS
HICOM holds 79.05% equity interest in EON. However, the Proposed De-Listing and the Proposed Exit Offer are not considered related party transactions pursuant to the Listing Requirements.
As such, none of the Directors of EON and major shareholders and/or persons connected to them are deemed to have any interest, direct or indirect, in the Proposed De-Listing.
Notwithstanding the above, the Common Directors have abstained from any board deliberation in relation to the Proposed De-Listing and Proposed Exit Offer for good corporate governance
7. DIRECTORS’ STATEMENT
The Directors, save for the Common Directors, having considered the Proposed De-Listing, agree that the Proposed De-Listing be tabled to the shareholders of EON.
8. INDEPENDENT ADVISER
Pursuant to Paragraph 16.05(d) of the Listing Requirements, EON has appointed AmInvestment Bank Berhad as the independent adviser to advise and make recommendation for the consideration of the shareholders of EON in connection with the Proposed De-Listing as well as the fairness and reasonableness of the Proposed Exit Offer.
9. ESTIMATED TIMEFRAME FOR COMPLETION
Barring unforeseen circumstances, the Proposed De-Listing and the Proposed Exit Offer are expected to be completed by the third quarter of 2008.
10. OTHER INFORMATION
A circular in relation to the Proposed De-Listing together with the notice of EGM and the advice of the independent adviser in relation to the Proposed De-Listing and the Proposed Exit offer will be despatched to the shareholders of EON in due course.
This announcement is dated 24 March 2008.