KUALA LUMPUR (Oct 6): Insas Bhd is listing its stockbroking arm M & A Securities Sdn Bhd (M&A) via a reverse takeover of furniture maker SYF Resources Bhd. 

The securities firm is valued at RM222 million, representing a price-to-book valuation of 1.2 times — which is generally higher than most banks listed on Bursa Malaysia — and a price-to-earnings ratio of 11.8 times. 

Under the proposal, Insas will inject M&A into SYF, comprising 100 million ordinary shares and 60 million redeemable convertible preference shares, in exchange for 1.58 billion new SYF shares. 

“The proposed M&A disposal is essentially a backdoor listing of M&A via SYF, which will enable Insas to create a separate listing platform for M&A on the Main Market of Bursa Securities,” the company said in a statement.  

Insas added ttha the listing status of M&A will enable the latter to raise future equity and debt funding requirements through the capital market, expand its customer base, as well as retain and attract new employees from the financial services industry.

Upon completion of the backdoor listing exercise, Insas will emerge as the controlling shareholder of SYF with 75.9% stake, from 8.8% currently. Insas will seek an exemption from undertaking a mandatory offer for the remaining shares it does not own. 

SYF will be renamed as M & A Capital Bhd, which will be principally involved in the business of financial services.

(More to come)