Stock With Momentum: Seremban Engineering

TheEdge Thu, Sep 05, 2019 10:49am - 4 years View Original


Seremban Engineering Bhd (-ve)

TRADING of shares in Seremban Engineering Bhd (SEB) (fundamental: 0/3, valuation: 0.3/3) triggered our momentum algorithm yesterday for the fourth time this year.

The counter closed 5.5 sen or 12.36% higher at 50 sen yesterday, with 1.71 million shares traded, exceeding its 200-day average volume of 20,863 shares. On Tuesday, the group announced that MIE Industrial Sdn Bhd has emerged as its new controlling shareholder after acquiring a 69.72% stake in the company at 50 sen a share, triggering a mandatory general offer for the loss-making engineering group that specialises in the fabrication of process equipment and metal structures.

MIE, which intends to maintain SEB’s listing status, is now obliged to extend the same offer via an unconditional mandatory takeover to acquire all the remaining 24.13 million SEB shares it does not hold, representing 30.28% of its total outstanding shares.

The offer price is a premium of 15.2% to SEB’s five-day volume-weighted average price of 43.4 sen.

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